Response to the following problem:
Gail Dribble is analyzing the shares of Petscan Radiology. Petscans stock pays dividend once each year, and it just distributed this years $0.85 dividend. The market price of the stock is $12.14 . Gail estimates that Petscan will increase its dividends by 7% per year forever. After contemplating the risk of Petscan stock, Gail is willing to hold the stock only if it provides an annual expected return of at least 13%. Should she buy Petscan shares or not?