Bennett, Inc. common stock currently sells for $20.50 per share. The company's executives anticipate a constant growth rate of 8.7 percent and an end-of-year dividend of $2.25.

a. What is your expected rate of return if you buy the stock for $20.50?

b. If you require a return of 15 percent, should you purchase the stock?

If you require a return of 15 percent, you should ____ the stock because the expected rate of return is ____ your required rate of return or the intrinsic value of the stock is _____ the current market price