Suppose that D0=$1.00 and the stock's last closing price is $14.71. It is expected that earnings and dividends will grow at a constant rate of and the most appropriate required rate of return is rs=10.00%. The dividend received in period 1 is D1=$1.00(1+0.0300)=$1.03 and the estimated intrinsic value in the same period is based on the constant growth model: P1=rsgD2. 3.00%7.00%10.00%13.00% Note that this stock is called a "Hold" as its forecasted intrinsic value is equal to its current price P0=rsgD1=0.10000.0300$1.03=$14.71 and the 3.00%, the stock's forecasted intrinsic value would be P0=0.10000.0500$1.03=$20.60, which is greater than $14.71. In this case, you would call the stock a "Buy". Suppose that the growth rate is expected to be 2.00%. In this case, the stock's forecasted intrinsic value would be its current price, and the stock would be a