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Homework answers / question archive / Steady As She Goes Inc

Steady As She Goes Inc. will pay a year-end dividend of $2.60 per share. Investors expect the dividend to grow at a rate of 6% indefinitely.

**a)** If the stock currently sells for $26.00 per share, what is the expected rate of return on the stock? **(Do not round intermediate calculations. Enter your answer as a whole percent.)**

**?b)** If the expected rate of return on the stock is 18.50%, what is the stock price? **(Do not round intermediate calculations. Enter your answers rounded to 2 decimal places.)**

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