Consider two firms, Chihuahua Corporation and Bernard Industries, that are each expected to pay the same $$1\mathrm{.}60$ million dividend every year in perpetuity. Chihuahua Corporation is riskier and has a cost of capital of $15\mathrm{.}25\%.$ Bernard Industries is not as risky as Chihuahua, so Bernard has a cost of capital of only $12\mathrm{.}25\%.$ Assume that the market portfolio is not efficient. Both stocks have the same beta and the CAPM would assign them both an expected return of $11\mathrm{.}15\%.$

The market value and alpha of Bernard is:

Question $11$ options:

$13\mathrm{.}06$M and $1\mathrm{.}10\%$

$10$M and $2\mathrm{.}10\%$

$11\mathrm{.}5$M and $2\mathrm{.}51\%$

$13\mathrm{.}16$M and $-0\mathrm{.}75\%$