1.) Use the constant growth dividend discount model and consider the following ABC stock is expected to have earnings of $7.00/share next year. The stock has a market capitalization rate, k, of 13%

If the firm has an ROE of 15% and a plowback ratio of 0.5, what is the intrinsic value of the stock?

2.)Use the constant growth dividend discount model and consider the following. ABC stock is expected to have earnings of \$8.00/share next year. The stock has a market capitalization rate, k, of 12%

What would be the value of the stock if its managers did not reinvest in the firm (i.e,b=0) and paid out all earnings in the form of dividends to shareholders (what is the no-growth value)?

Please show all work! Thanks