4. Consider a firm with year-end earnings per share projected to be $1.00 and a required rate of return of 12%. The firm is expected to have two high growth phases and then stabilize at a long run growth rate as outlined in the table below. Initially, the plowback ratio (b) is high but then it declines in two steps to a steady state value. What is the value of a share of this company's stock? End-of-phase earnings Phase Duration Assumptions $1 x (1.18) g=18%, b= .7 g 12%, b 55 $1 x (1.18)4 x (1.12)4 5 years 4 years Perpetual g7%, b = 4