12. In the current year, company I's profit or loss is 20, its beginning book value of equity is 100, and its ending book value of equity is 110. An analyst predicts that company I's next year's profit or loss will be 50. The analyst further assumes that company I's cost of equity is 10 percent and its abnormal profit growth follows the following process:

Abnormal profit growth in year t+1 = 0.5 x abnormal profit growth in year t

Under these assumptions, the analyst's estimate of company I's equity value is

A.500.00

B.515.83

C.741.67

D.2590.00