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Financial Learning Systems has 2.6 million shares of common stock outstanding and 102,396 shares of preferred stock. (The preferred pays annual cash dividends of $4.32

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Financial Learning Systems has 2.6 million shares of common stock outstanding and 102,396 shares of preferred stock. (The preferred pays annual cash dividends of $4.32 a share, and the common pays annual cash dividends of 22 cents a share.) Last year, the company generated net profit (after taxes) of $7,621,631. The company's balance sheet shows total assets of $81 million, total liabilities of $34 million, and $5 million in preferred stock. The firm's common stock is currently trading in the market at $36.96 a share. a. Given the preceding information, find the EPS, P/E ratio, and book value per share. b. What will happen to the price of the stock if EPS rises to $4.06 and the P/E ratio stays where it is? What will happen if EPS drops to $1.67 and the P/E doesn't c. What will happen to the price of the stock if EPS rises to $4.06 and the P/E jumps to 18.7 times earnings? d. What will happen if both EPS and the P/E ratio drop-to $1.67 and 7.9 times earnings, respectively? e. Comment on the effect that EPS and the P/E ratio have on the market price of the stock. change? a. The firm's EPS is $. (Round to two decimal places.)

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