Erna Corporation is evaluating an extra dividend versus a share repurchase. In either case, $$53,500$ would be spent. Current earnings are $$1\mathrm{.}79$ per share and the stock currently sells for $$64$ per share. There are $9,000$ shares outstanding. Ignore taxes and other imperfections in answering parts $($a$)$ and $($b$).$

a$.$ Evaluate the two alternatives in terms of the effect on the price per share of the stock and shareholder wealth.

b$.$ What will be the effect on the company's EPS and PE ratio under the two different scenarios?

c$.$ In the real world, which of these actions would you recommend? Why?