Melissa Cutt is thinking about buying some shares of EZLawn Equipment, at $ 43.89 per share. She expects the price of the stock to rise to $ 56.24 over the next 3 years. During that time she also expects to receive annual dividends of $ 5.62 per share.

a. What is the intrinsic worth of this stock, given a required rate of return of 12 % ?

b. What is its expected return?