PLEASE USE EXCEL WITH FORMULAS Problem $1[5$ points$]$:

McGaha Enterprises expects earnings and dividends to grow at a rate of $25\%$ for the next $4$ years, after

the growth rate in earnings and dividends will fall to zero, i$.$e$.,g=0.$ The company's last dividend, $D_0,$

was $$1\mathrm{.}25,$ its beta is $1\mathrm{.}20,$ the market risk premium is $5\mathrm{.}50\%,$ and the risk$-$free rate is $3\mathrm{.}00\%.$ What is the

current price of the common stock?

Problem $2[5$ points$]$:

The value of Broadway$-$Brooks Inc.$\text{'}$s operations is $$900$ million, based on the corporate valuation model.

Its balance sheet shows $$70$ million in accounts receivable, $$50$ million in inventory, $$30$ million in short$-$

term investments that are unrelated to operations, $$20$ million in accounts payable, $$110$ million in notes

payable, $$90$ million in long$-$term debt, $$20$ million in preferred stock, $$140$ million in retained earnings,

and $$280$ million in total common equity. If the company has $25$ million stock outstanding shares, what

is the best estimate of the stock's price per share?