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What will be the next year's EPS?

Soencer Supplies' stock is currently selling for $60 a share. The firem is expected to earn $5.40 share this year and to pay a year-end dividend of $3.60.
(a) If investors require a 9% return, what rate of growth must be expected for Spencer?
(b) If Spencer reinvests earnings in projects with average returns equal to the stock's expected rate of return, the what wil be next year's EPS?

Booher Book stores has a beta of 0.8. The yield on a 3-month T-bill is 4% and the yield on a 10-year T-bond is 6%. The market risk premium is 5.5%, and the return on an average stock in the market last year was 15%. What is the estimated cost of common equity using CAPM? step by step answers please.

$2.19