McNally Motors has yet to pay a dividend on its common stock. However, the company expects to pay a $1.00 dividend starting two years from now (i.e., D2 = $1.00). Thereafter, the stock's dividend is expected to grow at a constant rate of 5 percent a year. The stock's beta is 1.4, the risk-free rate is kRF = 0.06, and the expected market return is kM = 0.12.

A. Calculate P0

B. Calculate P1, P2, and P3

C. Calculate dividend yield for year 0 ( if purchase the stock now)

D. Calculate capital gain yield for year 20.

P.S.: Please use the HP 10BII+ Financial Calculator