1. You are considering the purchase of 350 shares of Kalem Corp. which have a market price of TL37.10 a share. In the most recent year, Kalem Corp. had earnings per share of TL3.60, of which 40% was paid out as dividends. For the next three years, the dividends are expected to grow at a rate of 15%, after which they will grow at a rate of 7% in year four to infinity. The required rate of return is 12%. a) What is the present value of the expected dividends for the first three years? b) What is the present value of the shares for the second stage of the growth model? c) Should you purchase the stock at the market price of TL37.10