1. A stock has an expected return of 13.3% and a beta of 1.19, and the expected return on the market is 12.3%.
What must the risk-free rate be? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places)
2. Derive the operating free cash flow and free cash flow to equity for Sundanci. Additionally, compute the price of the stock according to both definitions.
3. An investment will offer $451 per year forever, starting 6 years from today. If the relevant interest rate is 11% per year (as an EAR), what is the value of the investment 2 years from today?