B	C	D
The market concensus is that the Alpha Company has an ROE of		10.00%
The firm has a beta of	1.36	and plans to maintain its
traditional plowback ratio (b) of 3/4.
The current EPS is	$2.55
The annual dividend was just paid.
The concensus estimate of the coming year's market return (Rm) is		15.45%
The T-Bills currently are	5.60%
What is the approximate PVGO?
a.	Approximate PVGO = $4.87
b.	Approximate PVGO = $8.47
c.	Approximate PVGO = -$4.87
d.	Approximate PVGO = -$8.47
B	C	D
The ABC Corp. has a dividends growth rate of	4.34%	per year.
The year end dividend is	$6.25
The market capitalization rate is	11.34%
The Expected EPS or EPS1 is	$16.34
What is the implied Approximate Value of the ROE?
a.	Approximate Value of the ROE = 4.34%
b.	Approximate Value of the ROE = 7.03%
c.	Approximate Value of the ROE = 8.03%
d.	Approximate Value of the ROE = 11.34%
B	C	D	E
The stock of Gamma is currently selling for			$32.78
Earnings per share in the coming year is expected to be			$4.33
The company has a retention rate of			76.00%
The return on equity (ROE) for the firm is			16.50%
The situation is expected to continue indefinitely.
Assume the current market price of the stock reflect its intrinsic value as computed using
the constant growth DDM.
What is the approximate PVGO and is the stock undervalued or overvalued?
a.	Approximate PVGO is -$5.27 and is Overvalued.
b.	Approximate PVGO is $5.27 and is Undervalued.
c.	Approximate PVGO is $5.27 and is Overvalued.
d.	Approximate PVGO is $4.75 and is Undervalued.