LuLU Co. paid a dividend of 2 last year. They are expected to pay 2.2 this year. The rate of growth is expected to continue forever. Shareholders need to earn 15%. Find the fair price. 2. Jeffersonco stock is currently valued at 8 per share. Find the price of a 6 month call with an exercise price of 7. Jeffersonco variance is .04. The risk free rate is 3%. 3. The Cleaning Co can currently generate EPS of 4 per year forever by just maintaining current operations. Shareholders need to earn 12%. The co pays all the EPS as a dividend. The Co. has found a machine for sale that should earn a 15% return on investment. he hesitates to buy it, because he would have to retain 60% of the EPS to buy to run it, thus cutting his dividend. Calculate (and show) the numbers that can help the Co decide what he should do, then tell him.