schweser practice exam I next, practice, expected, provided

siavosh

This is a simple question. However, I got stuck in one simple calculation provided by the answer. Would really appreciate if someone can clarify it.
It’s exam I morning section #9-c, calculating expected rate of return. It uses P/E multiples to get the stock price for next period. However, it gets required return of 10.5%, g of 6.825%, using the formula of d1/(r-g) should get the current stock price. How come it uses such formula to get the next period stock price?
Thanks in advance.