1. A pharmaceutical drug company has invented a useful drug and so is growing quickly. Dividends are expected to grow at a rate of 30 percent for the next 2 years, 20% in coming 2 years and then the growth rate will fall to a constant average growth pattern based upon the companys previous track record. The previous dividend pattern is given below:

2016	2017	2018	2019	2020
2	2.1	2.22	2.38	2.55

In addition, the analysts have classified the company as a speculative stock having Beta = 2.5. in the current year, the KSE 100 index also performed well, and a growth of 18% has been observed, while the 9 months t-bills rates were around 10% annually. What should be the worth of stock today? What should be the worth of stock if you work on the growth rate based upon the internal sustainable growth rate rather than based on the dividend history (lets assume that the company has retained 40 Ruppes out of 100 Rupees profit and on average the company is earning 10% returns on its shareholders equity)?