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Holtzman Clothiers's stock currently sells for $32 a share. It just paid a dividend of $1.5...

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Finance

Holtzman Clothiers's stock currently sells for $32 a share. Itjust paid a dividend of $1.5 a share (i.e., D0 = $1.5).The dividend is expected to grow at a constant rate of 8% ayear.

  1. What stock price is expected 1 year from now? Round your answerto two decimal places.
    $
  2. What is the required rate of return? Round your answer to twodecimal places. Do not round your intermediate calculations.

Answer & Explanation Solved by verified expert
3.8 Ratings (604 Votes)
Part b Required rate of return is computed using the equation given below P0 D1 r g r g D1 P0 r D1 P0 g 162 32 008    See Answer
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