QUESTION $9$

Village Goofball stock is currently priced at $$76\mathrm{.}25$ per share and is expected to pay its next dividend, which is expected to be $$6\mathrm{.}40,$ in $1$ year. The stock has a risk premium of $10\mathrm{.}83\%,$ the risk$-$free rate is $4\mathrm{.}51\%,$ and inflation is expected to be $2\mathrm{.}83\%.$ What is the stock price of Village Goofball expected to be in $1$ year?

$$ $$87\mathrm{.}95($plus or minus $10$ cents$)$

$$85\mathrm{.}79($plus or minus $10$ cents$)$

$$86\mathrm{.}67($plus or minus $10$ cents$)$

$$81\mathrm{.}55($plus or minus $10$ cents$)$

None of the above is within $10$ cents of the correct answer