Zanele's stock has an expected ROE of $12\%$ per year, expected earnings per share of R$4$ and expected dividends of R $2\mathrm{.}40$ per share. The required rate of return is $10\%.$

$1\mathrm{.}1$ What is Zanele's share expected growth rate?

$1\mathrm{.}2$ Calculate the intrinsic value of Zanele's stock and its $\frac{P}{E}$ ratio.

ABC stock has an expected ROE of $12\%$ per year, expected earnings per share of $R4$ and expected dividends of $R3$ per share. The required rate of return is $10\%.$

$2\mathrm{.}1$ What is the expected growth rate?

$2\mathrm{.}2$ Calculate the intrinsic value of the ABC stock and its $\frac{P}{E}$ ratio.

Consider the following information for stock A and $B.$

$\backslash$table$[[$Stock$,$Expected return,Beta $()],[$A$,12\%,1],[$B$,13\%,1\mathrm{.}5]]$

The market's expected return and the risk free rate are $11\%$ and $5\%$ respectively.

$3\mathrm{.}1$ According to CAPM, what is the expected return of each stock?

$3\mathrm{.}2$ Calculate the alpha of each stock and comment on the pricing of these two stocks.

$4.$ Grow & Fly Industries has just paid its annual dividend of $R3$ per share. This dividend is expected to growth at a constant rate of $8\%$ indefinitely. The beta of Grow & Fly share is $1\mathrm{.}25,$ the risk$-$free rate is $6\%$ and the expected return on the market is $14\%.$ Calculate the intrinsic value of Grow & Fly share.

$5.$ ABC stock has an expected ROE of $12\%$ per year, expected earnings per share of $R2,$ and expected dividends of R$1\mathrm{.}50$ per share. Its market capitalisation rate is $10\%$ per year.

$5\mathrm{.}1$ What are its expected growth rate, its price, and its $\frac{P}{E}$ ratio?

$5\mathrm{.}2$ If the plowback rate were $0\mathrm{.}4,$ what would be the firm's expected dividend per share, growth rate, price, and $\frac{P}{E}$ ratio?