Question 4 [10 Marks] Prepare two estimates of Pearson's cost of common equity using the dividend growth model where you use growth rates in dividends that are 25% lower than the estimated 6.25% and growth rates in dividends that are 25% greater than the estimated 6.25%. The current dividend is R0.49 per share and the price of common stock is R19.39. Question 5 [10 Marks] Suppose a company uses only debt and internal equity to finance its capital budget and uses CAPM to compute its cost of equity. Company estimates that its WACC is 12%. The capital structure is 75% debt and 25% internal equity. Before tax cost of debt is 12.5% and tax rate is 20%. Risk free rate is 6% and market risk premium is 8% : What is the beta of the company