The share prices of a country's top 100 companies totalled $8341.63 at the end of 2013. This value can be thought of as the price of a portfolio containing each of these 100 company shares and an average market index. These 100 companies paid dividends totalling $189.70 in 2013. In 2003 dividends paid by these companies were $100.70. In 2013 the 10-year Government bond rate was 3.5% and the rate of return on a well diversified portfolio was 8.5%. Set out whether the stock exchange (measured by these 100 companies) was "overvalued" or "undervalued" in 2013 using the Gordon Dividend model approach. Make sure you clearly justify your assumptions on the values of key parameters in the Gordon model from the (limited) information you have.