Erna Corporation is evaluating an extra dividend versus a share repurchase. In either

case, $$18,000$ would be spent. Current earnings are $$1\mathrm{.}70$ per share and the stock

currently sells for $$64$ per share. There are $4,000$ shares outstanding. Ignore taxes and

other imperfections.

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

and shareholder wealth per share. $($Do not round intermediate calculations and

round your answers to $2$ decimal places, e$.$g$.,32\mathrm{.}16.)$

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

scenarios? $($Do not round intermediate calculations and round your answers to $2$

decimal places, e$.$g$.,32\mathrm{.}16.)$

Answer is not complete.