Total Points: 10 The following formula may be useful for answering the questions CAPM No Growth Model: Constant Growth Model: Vg - perpetual growth rate in dividends k-g Decomposition of ROE ROE = Tax burden x Interest burden x Margin x Turnover x Leverage ROE =(1-Tax rate) [ROA + (ROA-Interest rate) bt . QI: The risk-free rate of return is 5%, the required rate of return on the market is 10%, and High-Flyer stock has a beta coefficient of 1.5. If the dividend per share expected during the coming year, Di, is $2.50 and the dividend growth rate is 2%, at what price should a share sell? Q2: A firm has a tax burden ratio of 0.75, a leverage ratio of 1.25, interest burden of 0.6, and a return on sales of 10%. The firm generates S2.40 in sales per dollar of assets. What is the firm's ROE