Question: please help ETHICS PROBLEM Melissa is trying to value Generic Utility, Inc.'s stock, which is clearly not growing at all. Generic declared and paid a

please help please help ETHICS PROBLEM Melissa is trying to value Generic Utility, Inc.'s

ETHICS PROBLEM Melissa is trying to value Generic Utility, Inc.'s stock, which is clearly not growing at all. Generic declared and paid a dividend of $5 last year. The required rate of retum for till stocks is 14%, but Melissa is unsure about the financial reporting integrity of Generic's finance team. She decides to add an extra 2% credibility risk premium to the required retum as part of her valuation analysis a. What is the value of Generic's stock, assuming that the financials are trustworthy? b. What is the value of Generic's stock, assuming that Melissa Includes the extra 2% credibility risk premium? e. What is the difference between the values found in parts a and b, and how might one interpret that difference? a. The expected value of Generic's stock, assuming that the required ruto of rotum for utility stocks is application to Generic Utary, Inc, is (Round to the nearest cont) b. The expected value of Generio's stock, assuming that Melissa includes the extra 2% "credibilly nak premium, c.Comparing the findings in partea and b, the amount the expected value of the stock, Meissn includes a condibility premium in het calculations, will be insa than when asuming the repared state of return for utilities is s Based on your answer above, judge whether the following statement is true or false? (Select the best answer below) Lack of integrity may hurt stock prices because of the credibility promien." (Round to the nearest) (Round to the nearest Cent) False 0 0 True

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