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JumboTransport, anair-cargo company, expects to have earnings per share of $2.75 in the coming year. It decides to retain 20% of these earnings in order

JumboTransport, anair-cargo company, expects to have earnings per share of $2.75 in the coming year. It decides to retain 20% of these earnings in order to lease new aircraft. The return on this investment will be25%. If its equity cost of capital is 10%, what is the expected share price of JumboTransport?

A.

$30.80

B.

$44.00

C.

$26.40

D.

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