Cherry has the option of investing J$1,000,000 in either stock A or stock B. Which stock should she invest in?

The details pertaining the stocks are as follows:

Stock A

The current dividend on stock A is $4.80. The expected dividend for year 1 is $5.00, for year 2 it is $5.50, for year 3 it is $6.20, for year 4 it is $6.45, and thereafter it is expected to increase by 4%. The cost of capital is 9%.

Stock B

The current dividend on stock B is $6.00. This is expected to increase by 4% for the next 4 years, and thereafter by 3% forever. The cost of capital is 8% on stock B.