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Answers with explanations would be greatly appreciated need help asap! 1. You are considering an investment in Justus Corporation's stock, which is expected to pay

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Answers with explanations would be greatly appreciated need help asap!

image text in transcribed 1. You are considering an investment in Justus Corporation's stock, which is expected to pay a dividend of $2.25 a share at the end of the year D1 = $2.25 and has a beta of 0.9. The risk-free rate is 4.9%, and the market risk premium is 5%. Justus currently sells for $46.00 a share, and its dividend is expected to grow at some constant rate, assuming the market is in equilibrium, what does the market believe will be the stock price at the end of 3 years? (That is, what is P ^3?) a, what is the required rate of return from CAPM? B, what is the growth rate g? C, what is the price at the end of year 3? P3 2. Assume that it is now January 1, 2017. Wayne-Martin Electric Inc. (WME) has developed a solar panel capable of generating 200% more electricity than any other solar panel currently on the market. As a result, WME is expected to experience a15% annual growth rate for the next 5 years. Other firms will have developed comparable technology by the end of 5 years, and WME's growth rate will slow to 5% per year indefinitely. Stockholders require a return of 12% on WME's stock. The most recent annual dividend D0 , which was paid yesterday, was $1.75 per share. a, what is the expected dividend in year 2019? B, what is the stock price today

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