Business has been good for Keystone Control Systems, as indicated by the ten-year growth in earnings per share. The earnings have grown from $1.00 to $1.48.

A. Determine the compound annual rate of growth in earnings (n = 10).

Note: Do not round intermediate calculations. Input your answer as a percent rounded to 2 decimal places.

B. Based on the growth rate determined in part a, project earnings for next year (E1). Note: Do not round intermediate calculations. Round your answer to 2 decimal places.

C. Assume the dividend payout ratio is 50 percent. Compute D1. Note: Do not round intermediate calculations. Round your answer to 2 decimal places.

D. The current price of the stock is $14. Using the growth rate (g) from part a and (D1) from part c, compute Ke. Note: Do not round intermediate calculations. Input your answer as a percent rounded to 2 decimal places.

E. If the flotation cost is $1.50, compute the cost of new common stock (Kn) using growth rate (g) from part a and dividend (D1) from part c. Note: Do not round intermediate calculations. Input your answer as a percent rounded to 2 decimal places.