Nu-Tek, Inc

Nu-Tek, Inc. is expecting a period of intense growth, so it has decided to retain more of its earnings to help finance that growth. As a result it is going to reduce its annual dividend by 10% a year for the
Next three years. After that it will maintain a constant dividend of $.70 a share. Last year, the
Company paid $1.80 per share. What is the market value of this stock if the required rate of return is
13%?

A) $6.79
B) $7.22
C) $8.22
D) $8.87
E) $9.01