Constant growth \begin{tabular}{l|r} \hline Expected year-end dividend (D1) & $2.50 \\ \hline Beta coefficient & 0.90 \\ \hline Risk-free rate (rRF) & 3.30% \\ \hline Market risk premium (RPM) & 4.00% \\ \hline Current stock price (P0) & $45.00 \\ \hline Market in equilibrium & Yes \end{tabular} Calculate required return: Required return on common stock Formulas Calculate constant growth rate, g : Total return on common stock Expected dividend yield Expected capital gains yield \#N/A \#N/A HN/A Calculate stock price in 3 years, P3 : Number of years from today Calculate P3 using P0 \#N/A Aiternative calculation: Calculate P3 using dividends