5) XYZ Inc. is expected to payout a dividend of $8. It is predicted that the company will continue to grow at a rate of 3% per year. However, investors require a 6% rate of return per annum. At present, XYZ Inc. shares are worth $200 per share. John who already owns some shares of XYZ Inc. is wondering what investment decisions are available to him?

Show step by step how you arrive at your decision by showing all formulas, calculations and explanations (15 marks)