Here are data on two stocks, both of which have discount rates of 10%: Stock A Stock B Return on equity 10 % 8 % Earnings per share $ 2.40 $ 1.60 Dividends per share $ 1.20 $ 1.20

a. What are the dividend payout ratios for each firm? (Enter your answers as a percent rounded to 2 decimal places.)

b. What are the expected dividend growth rates for each stock? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.)

c. What is the proper stock price for each firm? (Do not round intermediate calculations. Round your answers to 2 decimal places.)