McIver's Meals, Inc. currently pays a $1 annual dividend. Investors believe that dividends will grow at 15% next year, 10% annually for the two years after that, and 5% annually thereafter. Assume the required return is 10%. What is the current market price of the stock?

A) $21.77
B) $22.99
C) $25.09
D) $26.13
E) $27.65

Grow at

Refers to the rate at which a particular variable or measurement, such as company revenue or population, increases over a specified period of time.

Required Return

The minimum return an investor expects to achieve from an investment, considering its risk level.

Annual Dividend

Annual Dividend is the total amount of dividends that a company pays out to its shareholders over the course of a year.