A stock currently sells for $28 a share. Its dividend is growing at a constant rate, and its dividend yield is 5 percent. The required rate of return on the company’s stock is expected to remain constant at 13 percent. What is the expected stock price, seven years from now?
a. $24.62
b. $29.99
c. $39.40
d. $41.83
e. $47.98
