Q$10.$ Your sister$-$in$-$law, a stockbroker at National Bank, is trying to sell you a stock with a

current market price of $$25\mathrm{.}61$ The stock's last dividend, DPSo, was $$2\mathrm{.}50,$ and

earnings and dividends are expected to grow at a constant rate of $3\%.$ Your required

rate of return on this stock is $12\%.$ From a strict valuation standpoint, you should:

a$.$ do not buy the stock; it is overvalued by $$4\mathrm{.}00.$

b$.$ buy the stock; it is fairly valued.

c$.$ buy the stock; it is undervalued by $$3\mathrm{.}00.$

d$.$ buy the stock; it is undervalued by $$1\mathrm{.}00.$