After careful financial statement analysis, we obtain these predictions for Colin Technology:

After careful financial statement analysis, we obtain these predictions for Colin Technology:Colin Technology’s cost of equity capital is estimated at 13%.CHECK(a) $7,205(d) $8,644Required:a. Abnormal earnings are expected to be $0 per year after Year 7. Use the accounting-basedequity valuation model to estimate Colin’s value at the beginning of Year 1.b. Determine Colin’s PB ratio using the results in (a). Colin’s actual market-based PB ratio is1.95. What do you conclude from this PB comparison?c. Determine Colin’s PE ratio using the results in (a). Colin’s actual market-based PE ratio is 10.What do you conclude from this PE comparison?d. If we expect Colin’s sales and profit margin to remain unchanged after Year 7 with a stablebook value of $8,506, use the accounting-based equity valuation model to estimate Colin’s valueat the beginning of Year 1