2. Castles in the Sand generates a rate of return of 10% on its investments and maintains a plowback ratio of 0.50. Its earnings this year will be $3 per share. Investors expect a rate of return of 8% on the stock. a. Find the price and P/E ratio of the firm. (Do not round intermediate calculations. Round your answers to 2 decimal places.) 18 points Price P/E ratio eBook 100 Hint b. Find the price and P/E ratio of the firm if the plowback ratio is reduced to 0.40. (Do not round intermediate calculations. Round your answers to 2 decimal places.) References Price P/E ratio