Assume the expected market risk premium is 10% and the risk-free rate is 5%. a. ZPL stock is now selling for $68 per share. It will pay a dividend of $3 per share at the end of the year. The expected price for ZPL at the end of the year is $77.24. What is its beta? (3 marks) b. Kelvin is buying a stock with an expected perpetual dividend of $300 but is unsure of its risk. If Kelvin thinks the beta of the stock is 0.8, when the beta is really 1.3, how much more will he offer for the stock than it is truly worth? [Hint: Value of perpetual cash flow = C/r] (7 marks)