Question 16 You expect that Bayless Enterprises will have earnings per share of $2 for the coming year. Bayless plans to retain all of its earnings for years 1-3. For the subsequent two years (years 4 and 5), the firm plans on retaining 50% of its earnings. It will then retain only 25% of its earnings from that point forward. Retained earnings will be invested in projects with an expected return of 20% per year. If Bayless's equity cost of capital is 9%, then the price of a share of Bayless's stock is closest to Hint: set this up in an excel spread sheet to project the future dividends. Also, find the expected price in year 5 by predicting the dividend in year 6, and the constant growth rate at that time. $4131 $24.82 $16.54 $53.42