1)You are considering the purchase of a common stock that just paid a dividend of $3.00 (DO = $3.00). You expect this stock to have a growth rate of 10 percent per year for two tears from t=0 to t=2, and then to have a long-run normal growth rate of 6 percent from t=2. If you require a 16 percent rate of return, how much should you be willing to pay for this stock? Select one: a. $34.14 b. $34.43 c. $34.48 d. $34.02 e. $34.25 2) If DO (current dividend) = $3, PO = $60, and g=6%, what's the cost of common equity based upon the DCF approach? a. 11.30% b. 11.00% c. 6.11% d. 11.22% e. 11.42%