Q8 (25 points). Financial crisis that started in August 2007 led to one of the worst bear markets in the last 50 years. What are the most immediate implications regarding growth prospects of the corporations and investors' uncertainty? Briefly explain and justify your thesis G) Explain and discuss the impact of these implications on stock market using (a) Gordon's model and b) any other model under RET, such as the simple returns calculation, ii) Do (i) () and ()() conclude to the same answer Gie do both models predict an increase or a decline in stock prices)? (iv). Assume that a typical stock's expected growth rate is 7 percent and the dividend is S4 per share. The required return of the investors is estimated as the sum of the risk-free rate (fr of the economy plus a risk premium (p)- that is:rrp. The risk-free rate of the economy is usually approached by the yield of the government bond. In this exercise assume that the yield of the government bond is 9% and the investors' risk premium is 2%. (a). Estimate the price of this stock b). What economic factors that impact government yields? Present briefly (v). Next, assume that yields on government bonds rise from 9% to 10.5% and, as a result, investor's risk perception increase from 2% to 2.5%. (a).Estimate the new price of the stock b). Compare and comment on (a) and (b