Balloons Inc normally pays a quarterly dividend. The last such dividend paid was $1.25, all future quarterly dividends are expected to grow at 7 percent, and the firm faces a required rate of return on equity of 14 percent. If the firm just announced that the next dividend will be an extraordinary dividend of $2.45 per share that is not expected to affect any other future dividends, what should the stock price be?
$17.15
$18.77
$20.09
$19.11