1- In the previous 5 years, Google paid an annual dividend as follows:

Year	Dividends
2011	2.7
2010	2.5
2009	2.2
2008	1.8
2007	1.5

1. Google is expected to pay a dividends of $3 in the next year (2012). What is the cost of equity of Google if its current stock price is $90? Calculate using excel (formulas viewable).

2. 2- As a technology-based firm, Google has a high beta of 1.4. if the risk-free rate of return is 5% and the market risk premium is 3%, calculate the cost of equity of Google using the capital asset pricing model (CAPM)? Calculate using excel (formulas viewable).