Assume​ you've generated the following information about thestock of​ Bufford's Burger​ Barns: The​ company's latest dividendsof ​$4.17 a share are expected to grow to ​$4.55 next​ year, to​$4.96 the year after​ that, and to ​$5.41 in year 3. After​ that,you think dividends will grow at a constant 6​% rate. a. Use thevariable growth version of the dividend valuation model and arequired return of 15​% to find the value of the stock. b. Supposeyou plan to hold the stock for three​ years, selling it immediatelyafter receiving the ​$5.41 dividend. What is the​ stock's expectedselling price at that​ time? As in part a​, assume a requiredreturn of 15​%. c. Imagine that you buy the stock today paying aprice equal to the value that you calculated in part a. You holdthe stock for three​ years, receiving dividends as described above.Immediately after receiving the third​ dividend, you sell the stockat the price calculated in part b. Use the IRR approach tocalculate the expected return on the stock over three years. Couldyou have guessed what the answer would be before doing the​calculation? d. Suppose the​ stock's current

price is actually ​$50.91. Based on your analysis from part a​,is the stock overvalued or​ undervalued? e. A friend of yoursagrees with your projections of​ Bufford's future​ dividends, buthe believes that in three​ years, just after the company pays the​$5.41 ​dividend, the stock will be selling in the market for​$55.10. Given that​ belief, along with the​ stock's current marketprice from part d​, calculate the return that your friend expectsto earn on the stock over the next three years.