House of Haddock has 5,090 shares outstanding and the stock price is $149. The company is expected to pay a dividend of $29 per share next year and thereafter the dividend is expected to grow indefinitely by 2% a year. The President, George Mullet, now makes a surprise announcement: He says that the company will henceforth distribute half the cash in the form of dividends and the remainder will be used to repurchase stock. There are no taxes.

a-1. What is the total value of the company before the announcement? (Enter your answer in whole numbers not in millions.) Total value $

a-2. What is the total value of the company after the announcement? (Enter your answer in whole numbers not in millions.) Total value $

a-3. What is the value of one share? (Do not round intermediate calculations. Round your answer to the nearest whole dollar.) Value $

b. What is the expected stream of dividends per share for an investor who plans to retain his shares rather than sell them back to the company? (Do not round intermediate calculations. Round your answers to 2 decimal places.) year 1: $ year 2: $