QUESTION 1 Five years ago, Anderson and Peterson set up CediBank- an investment bank which aims at serving the Ghanaian SME (Small and Medium Scale Enterprises) sector. Anderson is Head of Brokerage and Peterson is the Head of Equity Research. The President of the Association of Ghanaian Industries has requested that Anderson and Peterson deliver an investment seminar to its members at its next meeting. As an intern with CediBank, you have been tasked with analyzing Hair Pot, a beauty company that caters for the beauty needs of both males and females across the country. The team would rely on your analysis to explain the stock valuation process at the investment seminar. In your analysis, Anderson has asked that you answer the following questions: 1. If Hair Pot has a beta coefficient of 1.2, a risk-free rate (the yield on T-bonds) is 7 percent, and that the market risk premium is 5 per cent. What is the required rate of return on the firm's stock? 2. Assume that Hair Pot is a constant growth company whose last dividend (Do which was paid yesterday) was GHS2.00, and whose dividend is expected to grow indefinitely at a 6 percent rate. a. What dividend per share payments will shareholders receive from year 1 to year 3? b. At what price is Hair Pot currently selling? 2. Assume that Hair Pot is a constant growth company whose last dividend (Do which was paid yesterday) was GHS2.00, and whose dividend is expected to grow indefinitely at a 6 percent rate. a. What dividend per share payments will shareholders receive from year 1 to year 3? b. At what price is Hair Pot currently selling? c. What value will you place on Hair Pot's stock in a years time? What about two years from now? d. If an investor bought the stock today, what would their dividend yield and capital gains yield be at the end of the first year