An analyst is estimating the intrinsic value of the stock of xavier company. the analyst estimates that the stock will pay a dividend of $1.75 a share at the end of the year (that is, d1= $1.75). the dividend is expected to remain at this level until 4 years from now (that is, d2= d3= d4= $1.75). after this time, the dividend is expected to grow forever at a constant rate of 6% a year (that is, d5= $1.855). the stock has a required rate of return of 13%.
what is the expected intrinsic value of the stock one year from now, just after the dividend has been paid at t = 1? (that is, what is p1 ? )

a.
$27.18

b.
$24.75

c.
$20.93

d.
$23.75

e.
$22.50

x