1) Holtzman Clothiers's stock currently sells for $19 a share. It just paid a dividend of $1.5 a share (i.e., D0 = $1.5). The dividend is expected to grow at a constant rate of 9% a year.
What stock price is expected 1 year from now? Round your answer to two decimal places.
2) Carnes Cosmetics Co.'s stock price is $73.61, and it recently paid a $1.00 dividend. This dividend is expected to grow by 23% for the next 3 years, then grow forever at a constant rate, g; and rs = 14%. At what constant rate is the stock expected to grow after Year 3? Round your answer to two decimal places. Do not round your intermediate calculations.