Tangshan Antiques has a beta of 1.40, the annual risk-free rate of interest is currently 10 percent, and the required return on the market portfolio is 16 percent. The firm estimates that its future dividends will continue to increase at an annual compound rate consistent with that experienced over the 2010-2013 period. 
(a) Estimate the value of Tangshan Antiques stock.
(b) A lawsuit has been filed against the company by a competitor in 2013, and the potential loss has increased risk, which is reflected in the company's beta, increasing it to 1.6. What is the estimated price of the stock following the filing of the lawsuit in 2013?
Definitions:
Economic Growth
An increase in a nation's production of goods and services, measured by its gross domestic product (GDP) over time.
Consumer Goods
Items produced for personal consumption by individuals and households.
Productivity Of Land
Productivity of land refers to the amount and value of output (crops, minerals, etc.) produced per unit area, indicating the efficiency of land use in agricultural and industrial production.
Standard Of Living
The degree of riches, ease, possessions, and essentials accessible to a specific social class or region.
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