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PLEASE SHOW ALL FORMULAS: Facts: The Current risk free rate is 10.0% Market is providing a return of 15.0% Beta of 1.30 Recent History of

PLEASE SHOW ALL FORMULAS:

Facts:
The Current risk free rate is 10.0%
Market is providing a return of 15.0%
Beta of 1.30
Recent History of Dividends per share:
Expect to pay dividend per share next year of 3.18
Year Dividend
2015 2.94
2014 2.75 Calculator
2013 2.48 Input Function
2012 2.36 PV
2011 2.14 FV
2010 2.00 N
A) Calculate the constant growth rate:
Average annual growth rate in percent Solve for I =
Do parts B, C and D, using the Capital Asset Pricing Model (CAPM):
B) Determine the maximum cash price should pay for each share
CAPM =
P = D / (r - g) P = D / (r - g) $ -
D (Per Share Dividend) Expected D (Dividend) =
r (Required Return) r (CAPM Rate) =
g (Growth rate) g (Growth rate) =
C) Determine the effect on stock price if a 3% higher growth rate than shown in history.
CAPM =
P = D / (r - g) P = D / (r - g) $ -
D (Per Share Dividend) Expected D (Dividend) =
r (Required Return) r (CAPM Rate) =
g (Growth rate) g (Growth rate) =
D) If facts are same as B) above but Beta has changed to 1.0, determine max. cash price per share
CAPM =
P = D / (r - g) P = D / (r - g) $ -
D (Per Share Dividend) Expected D (Dividend) =
r (Required Return) r (CAPM Rate) =
g (Growth rate) g (Growth rate) =

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