5. Bayyoud Corp. is expected to earn $2.00, $2.20, and $2.40 per share in each of the next 3 years. At the end of the third year, the stock is expected to sell at a current yield of 3%. If the corp. dividends payout ratio of 25%. If an investor demands a 15% return for investing in Bayyouds Corp. how much should the investor be willing to pay for the shares today.

a.

$12.68

b.

$16.67

c.

$14.40