. Whited Inc.'s stock currently sells for $35.25 per share. The dividend is projected to increase at a constant rate of 4.75% per year. The required rate of return on the stock, rs, is 11.50%. What is the stock's expected price 5 years from now

Therefore, the stock price would be $44.46 in 5 years

Explanation:

Use dividend discount model of evaluating stocks to find the price 5 years from now. The models follows the formula below;

P1 = P0(1+g)

where P1 is next year's price

P0 is current price

g is the dividend growth rate which is assumed to be equal to growth rate of stock price.

P0 = 35.25

g = 4.75% or 0.0475 as a decimal

P5 = 35.25(1.0475)^5

P5 = $44.46

Therefore, the stock price would be $44.46 in 5 years

answer; standing committee;