The company's beta is 0.85, its dividend growth rate is 6.5%, and just yesterday it paid a dividend of $0.70 . The economy wide risk free interest rate is 4.5%, and the expected risk premium for the market portfolio is 10.0%. Find the stock's intrinsic value using the dividend constant growth model and the required rate of return implied by Capital Asset Pricing Model. Which statement is most accurate?
a. Intrinsic value is $9.97 and if the stock price is $14.91 you should not buy it
b. Intrinsic value is $8.67 and if the stock price is $14.91 you should buy it
c. Intrinsic value is $11.47 and if the stock price is $14.91 you should not buy it
d. Intrinsic value is $8.67 and if the stock price is $10.32 you should buy it
e. Intrinsic value is $9.97 and if the stock price is $10.32 you should not buy it
please show working out