Financial Learning Systems has 3.4 million shares of common stock outstanding and 78,843 shares of preferred stock. (The preferred pays annual cash dividends of $4.98 a share, and the common pays annual cash dividends of 23 cents a share.) Last year, the company generated net profit (after taxes) of $6,771,578. The company's balance sheet shows total assets of $72 million, total liabilities of $33 million, and $4 million in preferred stock. The firm's common stock is currently trading in the market at $46.79 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 $2.75 and the P/E ratio stays where it is? What will happen if EPS drops to $1.15 and the P/E doesn't change? c. What will happen to the price of the stock if EPS rise to $2.75 and the P/E jumps to 36.1 times earnings? d. What will happen if both EPS and the P/E ratio drop to $1.15 and 13.9 times earnings, respectively? e. Comment on the effect that EPS and the P/E ratio have on the market price of the stock. a. The firm's EPS is (Round to two decimal places.) The firm's P/E ratio is (Round to two decimal places.) The firm's book value per share is (Round to the nearest cent.) b. If EPS rises to $2.75 and the P/E ratio stays where it is, the new price is (Round to the nearest cent. If EPS drops to $1.15 and the P/E doesn't change, the new price iRound to the nearest cent.) c lf EPS rises to S2.75 and the PE umps to 36 1 times earnings, the new price is $. Round to the nearest cent.) d. If both EPS and the P/E ratio drop ,to $1.15 and 13.9 times earnings, respectively, the new price is $L. (Round to the nearest cent.) e. Comment on the effect that EPS and the P/E ratio have on the market price of the stock. (Select the best answer below.) O When the EPS rise (drop) for a aiven P/E multiple, the market price of the stock decreases (increases). Click to select your answer(s)