dividend
Question
Steady As She Goes Inc. will pay a year-end dividend of $3.30 per share. Investors expect the dividend to grow at
a rate of 4% indefinitely.
| a. | If the stock currently sells for $33 per share, what is the expected rate of return on the stock? (Do not round intermediate calculations. Enter your answer as a whole percent.) |
| Expected rate of return | % |
| b. | If the expected rate of return on the stock is 16.5%, what is the stock price? (Do not round intermediate calculations. Round your answer to 2 decimal places.) |
| Stock price | $ |
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