$3.$ If the stocks are less risky than bonds, then the risk premium on the stock may be zero. Assuming that the risk$-$free interest rate is $2$ percent, the growth rate of dividends is $1$ percent and the current level of dividends is $$70,$ use the dividend$-$discount model to compute the level of the S&P $500$ that is warranted by the fundamentals. Compare the result to the S&P $500$ level of $4300,$ and explain a possible reason for the difference based on the reasonableness of the assumptions used.