20 Omni Telecom is trying to decide whether to increase its cash dividend immediately or use the funds to increase its future growth rate. D1 PO = 1.73 points Ke - 9 eBook Po = Price of the stock today D1 = Dividend at the end of the first year D1 = Do (1 + g) Do = Dividend today Ke = Required rate of return g=Constant growth rate in dividends Hint Print Do is currently $2.10, Ke is 14 percent, and g is 6 percent. Under Plan A, Do would be immediately increased to $2.60 and Ke and g will remain unchanged. Under Plan B, Do will remain at $2.10 but g will go up to 7 percent and Ke will remain unchanged. a. Compute Pe (price of the stock today) under Plan A. Note D1 will be equal to Do * (1 + g) or $2.60 (1.06). Ke will equal 14 percent, and g will equal 6 percent. (Round your intermediate calculations and final answer to 2 decimal places.) Stock price for Plan A b. Compute po (price of the stock today) under Plan B. Note D1 will be equal to Do (1 + g) or $2.10 (1.07). Ke will be equal to 14 percent, and g will be equal to 7 percent. (Round your intermediate calculations and final answer to 2 decimal places.) Stock price for Plan B c. Which plan will produce the higher value? O Plan B O Plan A