Problem 1 - please show your calculations

McGaha Enterprises expects earnings and dividends to grow at a rate of 25% for the next 4 years, after the growth rate in earnings and dividends will fall to zero, i.e., g = 0. The company's last dividend, D0 , was $1.25, its beta is 1.20, the market risk premium is 5.50%, and the risk-free rate is 3.00%.

What is the current price of the common stock?

Problem 2 : - show your work

The value of Broadway-Brooks Inc.'s operations is $900 million, based on the corporate valuation model. Its balance sheet shows $70 million in accounts receivable, $50 million in inventory, $30 million in short-term investments that are unrelated to operations, $20 million in accounts payable, $110 million in notes payable, $90 million in long-term debt, $20 million in preferred stock, $140 million in retained earnings, and $280 million in total common equity.

If the company has 25 million shares of stock outstanding, what is the best estimate of the stock's price per share?