A company will pay a $3.5 dividend on each share of its stock next year. The company managers announced to their investors of their plan to continue growing which would allow the company to pay future dividends that will be increasing at a stable 5% annual rate. The required rate of return for this company is 10%.(Increase decimal places for anyintermediatecalculations, from the default 2 to 6 or higher. Only roundyour final answer to TWO decimal places:for example, 100.23.Do NOT use "$" in your answer.)

(a)If you buy shares of such stock today, the fair market price per share will equal $

$50.00

$52.50

$70.00

$73.50

$90.00

$93.50

#1

#2

#3

#4

#5

.(From the dropdown list, choose thecorrect $ amount.)

(b)If the shares currently sell for $80 each, it means: #

$50.00

$52.50

$70.00

$73.50

$90.00

$93.50

#1

#2

#3

#4

#5

.(From the dropdown list, choose the # from the list below that corresponds to your answer.)

#1the shares are currently overpriced by $10#2the shares are currently overpriced by $6.5#3the shares are currently priced just right#4the shares are currently underpriced by $6.5#5the shares are currently underpriced by $10