Suppose Acap Corporation will pay a dividend of 2.83$ per share at the end of this year and 3.02$ per share next year. You expect Acap's stock price to be 50.95$ in two years. Assume that Acap's equity cost of capital is 10.2%.

a. What price would you be willing to pay for a share of Acap stock today, if you planned to hold the stock for two years?

b. Suppose instead you plan to hold the stock for one year. For what price would you expect to be able to sell a share of Acap stock in one year?

c. Given your answer in (b), what price would you be willing to pay for a share of Acap stock today if you planned to hold the stock for one year? How does this compare to your answer in (a)?

Given your answer in (b), the price you would be willing to pay for a share of Acap stock today, if you planned to hold the stock for one year is ____. (Round to the nearest cent.)

Lastly CHOOSE ONE OF THE BELOW

A.The price in part (a) is lower than the price in part(c).

B.The price in part (a) is the same as the price in part (c).

C.The price in part (a) is higher than the price in part(c).

D.They are not comparable values.