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Financlal Learning Systems has 2.8 milion shares of common stock outstanding and 124,282 shares of preferred stock. (The preforred pays annual cash dividends of $4.72

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Financlal Learning Systems has 2.8 milion shares of common stock outstanding and 124,282 shares of preferred stock. (The preforred pays annual cash dividends of $4.72 a share, and she common pays annual cash dividends of 25 cents a shace.) Last year, the company generated net proff (after taxes) of $7.289,216. The company/s balance sheet shows total assets of $75 million total liablities of $27 mition, and $5 milion in preforred stock. The forris common stock is currently trading in the market at $48.19 a share a. Givan the preceding information, find the EPS, PVE ratio, and took value per share. b. What wil happen to the price of the stock if EPS risos to $3.48 and the PJE ratio stays where it is? What will happen it EPS drops to $1.32 and the PVE doesn't change? c. What will happen to the price of the stock if EPS rises to $3.48 and the P.E jumps to 28 s times earnings? d. What will happen if both EPS and the PIE ratio drop- to $1.32 and 11.1 times earnings, respectively? e. Comment on the effect that EPS and the PJE ratio have on the market price of the stock. a. The firmis EPS is s (Round to two decimal places.)

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