Gracie Enterprises is a publicly traded firm. The firm has committed to a regular dividend to shareholders. The firm has declared a dividend for the next period of $1.25 per share. Analysts expect that this dividend will grow at a 2.7% rate for the foreseeable future. You are considering an investment in the company. Similar companies are trading with a cost of equity capital of 11% per year. According to the dividend discount model, at what price would you be willing to buy a share of the company?

$7.55

$25.32

$33.49

$14.71