Net income for the previous year was $400,000, of which $200,000 was paid out in dividends. Dividends are expected to grow at a constant rate. The company has 200,000 shares outstanding and the book value of equity is $3,000,000. The appropriate P/E ratio for this type of company is 19.

Attempt 1/10 for 5.5 pts.

Part 1

What is the expected stock price 5 years from now?