Newburn Entertainments stock is expected to pay a year-end dividend of $3.00 a share. (D1 = $3.00, the dividend at time 0, D0, has already been paid.) The stocks dividend is expected to grow at a constant rate of 6 percent a year. The risk-free rate, rRF, is 6 percent and the market risk premium, (rM rRF), is 5 percent. The stock has a beta of 0.8. What is the stocks expected price next year (I am looking for P1 not P0?)

Select one:

a. $75.00

b. $79.50

c. $63.60

d. $78.00

e. $82.50