Magengo is evaluating KenGirl limited for possible inclusion in his portfolio. KenGirl is a young company that was formed three years ago. Magendo expects above average growth for the next five years. Magendo establishes the following facts and forecasts (as of the beginning of October 2017): The current market price is Ksh 5.77. The current dividend is Ksh 0.46. Magendo forecasts an initial 5-year period of 12 percent per year earnings and dividend growth during introduction phase. Magendo anticipates that KenGirl will grow 7.5 percent per year at mature phase. He estimates it will take 8 years for the transition to the mature growth period from introduction phase. The transition phase will have linear growth To estimate the required return on equity using CAPM, Magendo uses an adjusted beta of 1.2, an estimated equity risk premium of 4.5 percent, and a risk-free rate based on the 20-year Treasury bond yield of 5 percent. a) Estimate the required return on KenGirl using the CAPM. b) Estimate the value of KenGirl using a three-stage dividend discount model c) Calculate the percentages of the total value represented by the first stage and by the second and third stages considered as one group. 10 MARKS