a. Assume the B&R Enterprises just paid a dividend of $1. Its stock has a required rate of return of 12%, and investors expect the dividend to grow at a constant 8% rate in the future. What is the estimated stock price?

b. MicroDrive has preferred stock outstanding that pays an annual dividend of 7% of its $100 par value. If the required rate of return on this preferred stock is 5%, what is the value of MicroDrives preferred stock?

Note: Please use the formula approach to solve both problems.