Pertama Corporation's stock is currently selling for $160.00 per share and the firm's dividends are expected to grow at 5 percent indefinitely. In addition, Pertama Corporation's most recent dividend was $5.50. The expected risk free rate of return is 3 percent and the expected market return is 8 percent. Assume that Pertama Corporation has a beta of 1.20.

i. Calculate the expected return based on the dividend valuation model. (4 Marks)

ii. Calculate the required return using the Capital Asset Pricing Model (CAPM)? (4 Marks)

iii. Interpret whether Pertama Corporation would be a good investment at this time. (2 Marks)