$($Common stock valuation$)$ Assume the following:

the investor's required rate of retum is $12\mathrm{.}5$ percent,

the expected level of earnings at the end of this year $(E_1)$ is $$6,$

the retention ratio is $40$ percent,

the return on equity $($ROE$)$ is $14$ percent $($that is$,$ it can earn $14$ percent on reinvested earnings$),$ and

similar shares of stock sell at multiples of $8\mathrm{.}695$ times earnings per share.

Questions:

a$.$ Determine the expected growth rate for dividends.

b$.$ Determine the price earnings ratio $(\frac{?}{PI}{E}_1).$

c$.$ What is the stock price using the P$/$E ratio valuation method?

d$.$ What is the stock orice usina the dividend discount model?

a$.$ What is the expected growth rate for dividends?

$\%($Round to two decimal places.$)$