P7-24 (similar to) Question Help Integrative Risk and Valuation Hamlin Steel Company wishes to determine the value of Craft Foundry, a firm that it is considering acquiring for cash Hamlin wishes to determine the applicable discount rate to use as an input to the constant-growth valuation model. Craft's stock is not publicly traded. After studying the required returns of firms similar to Craft that are publicly traded, Hamlin believes that an appropriate risk premium on Craft stock is about 8%. The risk free rate is currently 5% Craft's dividend per share for each of the past 6 years is shown in the following table m a. Given that Craft is expected to pay a dividend of $3.68 next year, determine the maximum cash price that Hamlin should pay for each share of Craft (Hint Round the growth rate to the nearest whole percent) b. Describe the effect on the resulting value of Craft from (1) A decrease in its dividend growth rate of 2% from that exhibited over the 2014-2019 period. (2) A decrease in its risk premium to 7% a. The required return on Craft's stock is % (Round to the nearest whole percentage.) Enter your answer in the answer box and then click Check Answer Check Answer 5 parts remaining a u tom uppropriate sa premium on Craft stock is about 8%. The widend per share for each of the past 6 years is shown in the following table: expected to pay a dividend of $3.68 next year determine the maximum cash price that Hamlin should pay for each share of earest whole on the resultin 0 Data Table s dividend gro s risk premiun on Craft's stop (Click on the icon here into a spreadsheet.) in order to copy the contents of the data table below Dividend per Share $3.54 Year 2019 2018 2017 2016 2015 2014 $3.40 $3.27 $3.15 $3.02 $2.91 the answer bo Check Ans Print Done