chapter 10 question 11

You have assigned the following values to these three firms:

	Price			Upcoming Dividend							Growth			Beta
US Bancorp	$	51.35				$	2.25				7.00	%		1.78
Praxair		41.60					1.55				20.50			1.96
Eastman Kodak		43.15					2.00				8.40			0.84

Assume that the market portfolio will earn 11.00 percent and the risk-free rate is 4.00 percent.

Compute the required return for each company using both CAPM and the constant-growth model. (Do not round intermediate calculations and round your final answers to 2 decimal places.)

	CAPM	Constant-growth model
US Bancorp required return	%	%
Praxair required return	%	%
Eastman Kodak required return	%	%