1. A stock trades for $91 has a book value per share of $33, analysts EPS forecast for year 1 is $14. The required return is 13%. What is the speculative value implied by the observed market price? please show workings
2. A project has an initial cost of $1,000,000 and is expected to last for 2 years. In year 1, depreciation charge will be $100,000 and earnings are expected to be $108,463. In year 2, depreciation will be $100,000 and earnings are expected to be $209,998. Assume the required return is 9%. What is the value of this project?