1. Lisa Simpson is an security analyst at Left-handed Brothers Securities and has developed the following estimates for Doh! Doughnuts common stock which is currently selling for $40 per share. The risk-free rate is 2%, the market risk premium is 8%, and Doh!'s stock has a beta of 1.2 with a current dividend of $1.80 that has an expected constant growth rate of 7.5%. What is Lisa's estimate of the expected return for Doh! Doughnut's stock?
A. 9.2%
B. 12.3%
C. 10%
D. 11.2%
E.7.5%
2. An unmarried taxpayer with AGI of $120,000 in 2017 has a tax liability of $21,000. The taxpayer's 2018 AGI and tax liability are $175,000 and $31,000, respectively. To avoid any penalty for underpayment of estimated tax in 2018, the minimum amount the taxpayer must prepay during 2018 is:
A. $21,000
B. $23,100 (marked incorrect on test results already)
C. $27,900
D. $31,000
E. $34,100