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Company A's ROE agreed in the market is 10% beta of 1.2, and it is expected to maintain the traditional internal reserve ratio of 0.5.

Company A's ROE agreed in the market is 10% beta of 1.2, and it is expected to maintain the traditional internal reserve ratio of 0.5. This year's earnings are $3 per share and the annual dividend has already been paid. The projected annual market return for next year is 8%, and the current Treasury Securities yield is 1%. 1. What should be the selling price of this stock P(0) 2. Calculate the present value of company A's growth opportunities (PVGO). 3. As a result of your research, you are convinced that Company A will suddenly increase its internal retention rate by 2/3. Calculate the intrinsic value V(0) of this stock (increase to) Not increase by 4. The mayor is not yet aware of this decision. Explain why V(0) and P(0) cannot fall and why V(0) is greater or less than P(0).

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