The Jackson-Timberlake Wardrobe Co. just paid a dividend of $1.48 per share on its stock. The dividends are expected to grow at a constant rate of 5 percent per year indefinitely. Required:
(a) If investors require a 13 percent return on The Jackson-Timberlake Wardrobe Co. stock, what is the current price?
(b) What will the price be in 19 years?