JC stock currently does not pay any dividends, but it is expected to begin paying a dividend of $2 a share starting three years from today. Once established the dividends are expected to grow by 15% a year for 2 years, then finally reach their constant growth rate of 3% perpetually. JC has a beta of 2, the risk-free rate of return is equal to 6% and the required return on the market is 10%.

1. What is JC's required rate of return?
2. What should the price of a share of JC's stock be today?
3. What is your estimate of dividend yield and capital gains yield on JC's stock in the current year?
4. What is the expected price for AmaZoo in four years (P₄) and what is your estimate of dividend yield and capital gains yield in four years?