Problem $7-24$ Rate of Return $($LO$2)$

Steady As She Goes Incorporated will pay a year$-$end dividend of $$2\mathrm{.}70$ per share. Investors expect the dividend to grow at a rate of

$5\%$ indefinitely.

a$.$ If the stock currently sells for $$27\mathrm{.}00$ per share, what is the expected rate of return on the stock?

Note: Do not round intermediate calculations. Enter your answer as a whole percent.

Expected rate of return

b$.$ If the expected rate of return on the stock is $17\mathrm{.}50\%,$ what is the stock price?

Note: Do not round intermediate calculations. Enter your answers rounded to $2$ decimal places.

Stock price