2. Mitts Cosmetics Co.'s stock price is $58.88, and it recently paid a $2 dividend. This dividend is expected to grow by 25% for the next 3 years, and then grow forever at a constant rate, g, and the required return on the stock is 12%. At what constant rate is the stock expected to grow after Year 3? [Hint: you are recommended to draw a timeline to solve this problem] 4 points 3. Suppose a company will issue new 10-year debt with a par value of $1,000 and a coupon rate of 7.5%, paid annually. The tax rate is 30%. If the flotation cost is 2% of the issue proceeds, what is the after-tax cost of debt? 2 points