Fairview Machinery Ltd. (FML) recently paid a dividend of $1.64 per common share. The shares trade at $27 per share. Its beta is 0.8. Long term Canadian government bonds yield 6% and the expected market return is 11%. Question 24 (3 points) If investors expect dividends to grow at 3% per year, what rate of return do they expect on the stock? (3 Marks) Compare the expected return from (a) to FML's required return using CAPM. Is the market for FML's shares in equilibrium? If not what should the equilibrium price be? (3 Marks) If you expect dividends to grow by 10% per year for four years and then grow by 3% thereafter, and if you use CAPM to determine the required return for FML, what should the share price be? (6 Marks)