Answer both the questions in this section. Each whole question carries TWENTY FIVE marks. Clearly show all your workings. 1. Folfowing information is about Steady plc, a company in steady state. Estimate the equity value per share using the Dividend Discount model and the Free Cash Flow to Equity model. (10 marks) 1. Why are the values obtained from the two models different to each other? Which of these values will you use? (4+3 marks ) b. Empirical evidence shows multi-factor models such as the Fama and French three-factor model are better at explaining stock returns than the single factor CAPM. Why does the CAPM remain the most popular model for estimating the cost of equity? (5 marks) C. The operating working capital of Marks and Spencer has been negative for the last several years. Does this worry you? Justify your