Question 4 (20 marks) i. Sweet Pea shares have just paid a dividend of $0.50, which are expected to increase by 15% for the next three years. After that, they are expected to increase by 12% for the following two years, and by 10% per annum thereafter. The required rate of return on Sweet Pea shares is 14% per annum and they are currently selling for $15.28. Should you buy these shares? Why? (10 marks) Forest Products issued 10 year $1,000 bonds, three years ago, with 8% coupons paid semi- annually. If the yield on these bonds is currently 6%, at what price are they selling? (6 marks) b. If, in three years' time, the bond's yield is 9%, what will be their value at that time? (4 marks)