Coca-Cola will pay an annual dividend of $0.75 one year from now. Analysts expect this dividend to grow at 8.75% per year for three years. Thereafter, growth will slow down to 3.0% per year and remain there for the foreseeable future.

a) What dividend will the company pay in each of the first 5 years?

b) According to the dividend discount model, what is the value of a share of Coca-Cola stock today if the firms cost of equity capital is 9.0%?