#1: COST

#2: Johnson Controls Intl (JCI) #3: Ford (F), and #4: the Standard & Poors 500 (^GSPC)

Portfolio I: 60% #1 and 40% #2 o Portfolio II: 30% #1 and 70% #3 o Portfolio III:34% #1 and 33% #2 and 33% #3

Use the FCF model assuming that FCFs from your last annual year will grow by 5%, 4%, 10% for each of the next three years and then 3.5% every year thereafter. In this model the WACC will be assumed to be 12%. Clearly show all work and each step in Excel using functions where appropriate.

	Beta	Req. Rate of Return for individual stock
JCI	0.198434185	5.11%
F	0.052480244	4.22%
GSPC	11.6597342	75.02%
COST	0.472258113	6.78%

	Req. Rate of Return for portfolio
Portfolio I	6.11%
Portfolio II	4.99%
Portfolio III	5.38%

Risk Free	3.90%
Expected Market return	10%
RPm	6.10%

Portfolio	Most Recent Dividend	Growth Rate	Req. Rate of Return	Intrinsic Value
Portfolio I	1.10	6.11%	5.11%	-116.721
Portfolio II	1.50	4.99%	4.22%	-204.525974
Portfolio III	2.00	5.38%	6.78%	150.5428571