Janice Is Evaluating a Stock That Currently Pays a Dividend

Janice is evaluating a stock that currently pays a dividend of $0.25 per share. She expects this level of dividend to continue indefinitely, and she has determined that 5% is the appropriate required return for the stock. What is the most she should pay for the stock?

A) $1.25 per share
B) $2.50 per share
C) $5.00 per share
D) $7.50 per share