1. Explicate beta. Compare and contrast unsystematic and systematic risk. Elaborate on the determinants of beta.
2. Difuse Inc. will pay a common stock dividend of $3.55 at the end of the year (D1). The required return on common stock (Ke) is 20 percent. The firm has a constant growth rate (g) of 10 percent. Compute the current price of the stock (P0). Round your answer to 2 decimal places.