Problem 10-29 Required Return (LG10-3, LG10-7)

You have assigned the following values to these three firms:

	Price			Upcoming Dividend							Growth			Beta
US Bancorp	$	41.50				$	2.55				9.80	%		1.76
Praxair		78.80					1.28				16.50			2.83
Eastman Kodak		34.55					2.00				9.50			1.18

Assume that the market portfolio will earn 12.40 percent and the risk-free rate is 4.80 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	%	%