Horse and Buggy Inc. is in a declining industry. Sales, earnings, and dividends are all shrinking at a rate of 10% per year.

a. If r = 15% and DIV₁ = $2, what is the value of a share? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

b. If r = 15% and DIV₁ = $2, What price do you forecast for the stock next year? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

c. If r = 15% and DIV₁ = $2, What rate of return should you expect if you buy the stock today and sell it in one year? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)