Question: answer the second question The price You are forecasting the returns for Pharoah Company, a plumbing supply company, which pays a current dividend of $11.30.

answer the second question The price You are forecasting the returns

for Pharoah Company, a plumbing supply company, which pays a current dividend

answer the second question The price

You are forecasting the returns for Pharoah Company, a plumbing supply company, which pays a current dividend of $11.30. The dividend is expected to grow at a rate of 4.3 percent. You have identified two public companies, Novak and Splish, which appear to be comparable to Pharoah. Novak has the same total risk as Pharoah and a beta of 1.85. Splish, in contrast, has a very different total risk but the same market risk as Pharoah. Splish's beta is 1.65. The market risk premium is 5.15 percent and the risk-free rate is 1.65 percent. (a) Your answer is correct. Determine the required return for Pharoah using the appropriate beta. (Round answer to 3 decimal places, e.g. 3.361\%.) Determine the price of Pharoah. (Round answer to 2 decimal places, e.g. 125.61.)

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