As a stock analyst for a stockbroking firm, you are looking for undervalued securities. After searching the market, you identify Stock A and Stock B as potential purchases. Stock A is currently selling at $100 with an expected dividend of $6 and constant growth rate of 5%, while Stock B is a growth stock, currently selling at $60 with a dividend of $5 paid each year. Answer the following questions on the basis that you believe the required rates of return for both stocks should be 10%:

i. How much would you pay for Stock A?

ii. How much would you pay for Stock B?

iii. Which of the stock is undervalued? Provide your justification.