Stock Z has the following characteristics: - It pays a dividend of either 40 cents or 1 dollar (each with probability 0.5) for the next 10 periods (t=1,2,…,10). - At t=10, you will redeem each share of the stock you own for $7 (this is known as the redemption value) - The appropriate discount rate for Stock Z is 10% per period. 1. Calculate the value of Stock X according to the dividend discount model at each date t=1,…,10 ? 2. Do you think that the majority of the transactions will take place above or below this value? Explain why.