Janet Ludlow's firm requires all its analysts to use a two$-$stage DDM and the CAPM to value stocks. Using these measures, Ludlow has

valued QuickBrush Company at $$63$ per share. She now must value SmileWhite Corporation.

a$.$ Calculate the required rate of return for SmileWhite using the information in the following table:

December $2018$

Note: Risk$-$free rate $=3\%$; expected market return $=15\%.$

Instruction: enter your answer as a percentage rounded to $1$ decimal place.

Required rate of return

$\%$

b$.$ Ludlow estimates the following EPS and dividend growth rate for SmileWhite in the future:

Estimate the intrinsic value of SmileWhite in December $2018$ using the table above and the two$-$stage DDM$.$ Dividends per share in

$2018$ were $$1.$

Instruction: enter your answer as a decimal number rounded to $2$ decimal places.

Intrinsic stock value in $2021$:

Intrinsic stock value in $2018$: