Ajax has come out with a new and improved product. As a result, the firm projects an ROE of 15%, and it will maintain a plowback ratio of 80%. Its earnings this year will be $4 per share. The stocks beta is 1.25, the expected return on the market is 12%, and the risk-free rate is 4%.

What is the required rate of return?

At what price should the stock sell?

What is the present value of growth opportunities (PVGO)?

What would be the PVGO if the firm planned to reinvest only 50% of its earnings?