without the use of AI Stock of the ABC Corporation is projected to pay annual dividends in the future. The next

dividend will be $$1\mathrm{.}20$ and is expected one year from now. Dividends are predicted to increase

at the rate of $4\%$ per year. An investor is considering purchasing the stock and holding it for

$12$ years. The investor uses an effective annual interest rate of $12\%$ to evaluate the stock.

$($a$)$ If the investor expects the stock price to be $$60\mathrm{.}00($excluding dividend$)$ when selling

after $12$ years, what is the current value of the stock according to the investor $?$

$($b$)$ If the investor is prepared to pay $$25\mathrm{.}00$ now for the stock, what does this imply about

the stock price $12$ years from now $?$