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Intercontinental Inc. is an outdoor furniture company that is planning to considerably grow over the coming years. Gaining very good reputation with its high-quality products,

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Intercontinental Inc. is an outdoor furniture company that is planning to considerably grow over the coming years. Gaining very good reputation with its high-quality products, the company is projecting that it can grow at 10% over the coming 4 years and then the growth rate will decrease to 3% thereafter. Its earning per share (EPS) this year was $4 and the company's dividend pay-out ratio was 30%, that is its most recent dividends was $1.2. In order to finance this growth, the company needs to invest in new machinery and working capital. The company is considering three financing options to finance this growth: Either to raise equity, get an amortising loan from its bank or issue a bond. if the company chooses to raise equity, what would be the expected price/share given the projected growth rates and given that the expected return on the company's equity is 15% (assume the company uses the divided discount model). [Remove dollar sign and keep two decimal places in your final answer) 03 10. If instead the YTM was equal to the coupon rate of 129, what must be the price of the bond? (10 points) Enter your

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