Betablockers Inc. currently has 250,000 shares outstanding and expects earnings at the end of this year of $6,250,000. Betablockers plans to pay out 75% of its earnings in total, paying 50% as a dividend and using 25% to repurchase shares. Betablockers earnings are expected to grow by 2.5% per year after this year, and these payout rates remain constant. Betablockers cost of capital is 8%. Write rates as a percentage and round your answers at two decimals.

a. (5) What is the share price of Betablockers?

b. (2) What is the forward P/E-ratio for Betablockers?

c. (5) What is the growth rate of expected dividends?

d. (3) Why is your answer at 3c different from the expected growth rate of earnings? Explain briefly in words.