DAAs stock is selling for $15 per share. DAA has yet to pay a dividend, but the firm intends to declare a $2.00 dividend at the end of the third year. After the third year, dividends are expected to grow at a long-term growth rate of 6%. If the firms required return is 18%, the stock is

a. Undervalued by $3.03.

b. Overvalued by $3.03.

c. Correctly valued.

d. Overvalued by $2.25.

e. Undervalued by $2.25.