You are considering buying shares of Alpha company. It is paying a $2 dividend which you assume will grow by 1% annually for the next 5 years, and 5% annually thereafter. Your required rate of return is 14%.

Applying the dividend growth model, at what price do you value this stock?

You analysis was very helpful to Bozena. She has decided to participate in her company's 401(k) plan. She agrees with your analysis (question 4 in the chapter 6 assignment) and your estimate showing $2,133,202 in her retirement account upon retirement. She asks you if she expects to be in the 10% tax bracket upon retirement, and she wishes to fund a retirement that lasts for 25 years, how much after tax money will she have to spend monthly? She conservatively assumes she will earn 5% on her investments during retirement and withdrawals are made at the end of every month.

Enter your answer to the nearest dollar without the dollar sign. Please be very careful with your calculations and when entering your answer.