Q3 Question 3 10 Points The earnings per share of ZZL Ltd is expected to be $2.50 next year and the company is expected to retain 40% of these earnings forever. The earnings are expected to grow at a constant annual rate of 6% forever and the stock is currently trading at $10 per share. The standard deviation of the stock's retums is 30% and its covariance with the market portfolio is 0.135. The expected retum and standard deviation of the market portfolio is 15% and 50%, respectively, and the T-bill rate is 5%. Q3.1 Question 3, Part (a) 7 Points Based on this information, indicate whether the shares are underpriced or overpriced and explain why. Show your calculations. Enter your answer here mi Please selecties Selectie Q3.2 Question 3. Part (b) 3 Points Calculate the equilibrium share price. Show your calculations. Enter your answer here Please selecties Select