You are considering investing in stock W. It has just paid a dividend of 1.15 and you estimate that dividends in the company will grow at a rate of 5% per annum. Dividends are paid annually. Assume that the expected rate of return for this stock is 14%. The fair price of this stock (in pounds) is closest to?

a.

12.78

b.

8.62

c.

13.42

d.

6.36