Rocket Co. just paid a dividend of $4.00. You anticipate that Rocket Co. will grow at an annual rate of 5% over the next 3 years due to the demand for their solid and liquid rocket boosters used by the Kerbal Space Program. Beginning 4 years from now, you anticipate the that public interest in the space program will fall and the growth of Rocket Co. will slow down to the average growth rate of the Kermin economy, which is 2%. The current risk-free rate in the Kermin economy is 4%, the market risk premium is 5%, and the Beta of Rocket Co. is .7.

What is the cost of equity Rocket Co? Report your answer as a percent (i.e. 5.5% = 5.5)

What is the value of Rocket Co?