d. The current share price of Motors plc is 20. Next year's cash dividend is 0.85 Security analysts are forecasting that dividends will grow by 7.5% per year for the next five years. Assume that the 7.5% growth rate is expected to continue forever. What rate of return are investors expecting? (3 marks) 80 e. Ms. Lee is a retired teacher and depends on her investments for her income. Mr. Smith is a young executive who wants to save for the future. Both are stock- holders in Galactic PLC, space flight company, which is developing commercial spacecraft to take passengers into space. This investment's payoff is many years away. Assume it has a positive NPV for Mr. Smith. Explain briefly why this investment also makes sense for Ms. Lee. (4 marks) f. Why might one expect managers to act in shareholders' interest? Give some three reasons. (6 marks) (Total 25 marks)