Q$1.$ Gordon Growth Model $-$ Dividend Discount Model $($Chapter $4,$ Stock and Stock Valuation$)$

Please use the following information to answer the two questions that follow:

The up and coming publicly traded company, C$3$AI $($NYSE Symbol: AI$)$ focuses on enterprise level artificial intelligence. The firm is a stable dividend$-$paying company. Last year, it paid a dividend of $$5\mathrm{.}78$ per share near quarter's end. Analysts expect the company to maintain a constant growth rate of $6\mathrm{.}8\%$ in dividend growth for the future. Investors require an $11\%$ rate of return when investing in $C3$ AI's stock. Hint: We must first calculate the dividend in year $1.$

Two Questions:

Using the Gordon Growth Model $($Myron J$.$ Gordon, $1956)$

a$)$ What would be the intrinsic value of $C3AI\text{'}$s stock?

b$)$ Would you consider the intrinsic value of C$3$AI's stock to be under or overvalued, when compared to its going market price, of $$\frac{23\mathrm{.}87}{?}$ share? Show Formulas