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Company Qs current return on equity (ROE) is 15%. It pays out 55 percent of earnings as cash dividends (payout ratio = 0.55). Current book

Company Qs current return on equity (ROE) is 15%. It pays out 55 percent of earnings as cash dividends (payout ratio = 0.55). Current book value per share is $66. Book value per share will grow as Q reinvests earnings. Assume that the ROE and payout ratio stay constant for the next four years. After that, competition forces ROE down to 12.0% and the payout ratio increases to 0.80. The cost of capital is 12.0%. a. What are Qs EPS and dividends in years 1, 2, 3, 4, and 5? (Do not round intermediate calculations. Round your answers to 2 decimal places.) b. What is Qs stock worth per share? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

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