The Last Dividend Paid by Klein Company Was $1

Multiple Choice

The last dividend paid by Klein Company was $1.00. Klein's growth rate is expected to be a constant 5 percent for 2 years, after which dividends are expected to grow at a rate of 10 percent forever. Klein's required rate of return on equity (rs) is 12 percent. What is the current price of Klein's common stock?

A) $21.00
B) $33.33
C) $42.25
D) $50.16
E) $58.75