Belarus Bearing Just paid a dividend of 7.20 per share on its stock. The dividends are expected to grow at a constant rate of 6% per year, indefinitely. If investors require (the discount rate) a 12% return on Belarus Bearing stock, what is the current price (Po)? What will the price be in 3 (P3) years? In 15 years (P15)?

n If the stock is marketable at $95, what would be your investment decisions? Why?

n If the firms risk as perceived by market participants suddenly increases, causing the required return to rise to 20 percent, what will be the common stock value today?