1a) PageUp Inc common stock is currently trading at $20.25 per share. The stock pays annual dividends, and you expect the next dividend, paid one year from today, will be $1.07 per share. The firm does not expect to buy back stock, nor is it expected to sell new shares of stock. Both its ROE and Payout Ratios are expected to remain at their current levels forever. Its ROE is 5%, and its Payout Ratio is 38%. Based on its risk, youve estimated the stocks fair rate of return, E(r), to be 10% per year. Determine the IRR you would earn per year if you bought the stock today, and held it forever. Provide an answer, as a percentage, not as a decimal, with at least 4 digits of precision.

b) Red Rhinos has no intention of buying back stock or issuing new shares in the future. It pays annual dividends. You expect the dividend next year to be $2.53 per share. The stock is currently trading at a price of $43.07 per share. Based on risk, its fair discount rate, E(r), is expected to be 9.8% when measured as an EAR. You expect that its ROE next year will be 7%. You also expect it to payout 35% of next years earnings in the form of dividends. Determine the expected long-term growth rate of dividends for the firm. If there is insufficient data to answer the question, then answer 99.99. Provide an answer, as a percentage, not as a decimal, with at least 4 digits of precision.