4.

Metallica Bearings, Inc., is a young start-up company. No dividends will be paid on the stock over the next 12 years because the firm needs to plow back its earnings to fuel growth. The company will pay a $9 per share dividend in 13 years and will increase the dividend by 6 percent per year thereafter.

Required:

If the required return on this stock is 13 percent, what is the current share price? (Do not round your intermediate calculations.)

$30.55

$31.15

$26.25

$28.18

$29.66