1. (30 points) Assume that the average firm in vour company's industry is expected to grow at a constant rate of 6% and that its dividend yield is 7%. Your company is about as risky as the average firm in the industry, but it has just successfully completed some R&D work that leads you to expect that its earnings and dividends will grow at a rate of 50% [D-Do(1+g) - D (1.50this year and 25% the following year, after which growth should return to the 6% industry average. a. Ir the last dividend paid (D.) was $1, what is the value per share of your firm's stock? [DI = Doll +9 = Do(1,50 )1+25%) DU+60) O Forzsterioso DO = 1*(1.50) Y(1.25) 1*(1.50)* (1.25) = 1.8750 b. What are dividend yield and capital gains yield att0? It=0) * (11, 1.8750 + Gain Capuce