1. A stock is expected to pay a dividend of $1.00 at the end of the year (i.e., D1 = $1.00), and it should continue to grow at a constant rate of 3% a year. If its required return is 15%, what is the stock's expected price 5 years from today? Round your answer to two decimal places. Do not round your intermediate calculations.
2. CAPM AND PORTFOLIO RETURN You have been managing a $5 million portfolio that has a beta of 1.55 and a required rate of return of 10%. The current risk-free rate is 6.25%. Assume that you receive another $500,000. If you invest the money in a stock with a beta of 1.15, what will be the required return on your $5.5 million portfolio? Do not round intermediate calculations. Round your answer to two decimal places. _____%