The Jackson-Timberlake Wardrobe Company just paid a dividend of $1.52 per share on its stock. The dividends are expected to grow at a constant rate of 6 percent per year indefinitely. If investors require a return of 10 percent on the company's stock, what is the current price? (5 marks )

b. Use the same information given in (a). What will the price be in 12 years?5 marks )

FORMULAS

P_t = D_t (1 + g)/(R g)

P₀ = D₀ (1 + g)/(R g)

P₁₂ = D₁₂ (1 + g)/(R g)

P₁₂ = D₀ (1 + g)¹³/(R g)

note: handwrite