1. A rapidly growing firm is currently paying a dividend of $1.90. The dividend growth rate is expected to be 12% for the next 6 years. The dividend growth rate after the first 6 years is expected to be 3% annually. The expected return on the market is 8%, the risk free rate is 3% and the firms Beta is 1.25.
   1. Calculate the estimated price (intrinsic value) for a share of this firms stock.
   2. What does this firms Beta measure?
   3. Use Goal Seek to determine what the current dividend would need to be to yield an estimated price (intrinsic value) of $95.