1. Answer parts a, b, and c below based on the following information:

Chevron stock plans to pay a dividend of $1.50 so that D₁= $1.50. Assume the expected long-run constant growth rate for this stock is 2.0 percent and investors require a 6 percent rate of return (Rs=6%).

a.)What is the expected price of the stock?____________

b)If the actual price of this stock was $25.00/share, would you buy it based on your expected value?___________

Given that the value of the stock is $300 I would by it for $25

c)Why or why not?__________________