1) ABC stock just paid a $3 dividend which is expected to grow at a 1% rate, forever. The stock currently sells for $16. Find the required rate of return. Round intermediate steps and your final answer to four decimals. Enter your answer in decimal format (ex: .XXXX).

2) Alpha Industries plans on reinvesting heavily in itself for the next few years. The company plans to pay a $6 dividend next year, which will decrease by 3% for two years. After that, dividends are expected to grow at a 5% rate, indefinitely. If investors require a 10% return, what is the value of Alpha stock? Round intermediate steps to four decimals and your final answer to two decimals. Do not use the dollar sign when entering your answer.