A stock is expected to pay its first $4.3 dividend in 2 years from now (t=2). The dividend is expected to be paid annually forever and grow by -1% pa (note the negative sign). The discount rate is 5% pa. Estimate what the stock price will be in 3.25 years from now. The stock price at time 3.25 is expected to be:

Question 7Select one:

a.

$74.6576

b.

$71.8207

c.

$71.6667

d.

$71.1025

e.

$70.3915