P7.9 (similar to) Question Help Financial Learning Systems has 1.5 million shares of common stock outstanding and 66,068 shares of preferred stock. (The preferred pays annual cash dividends of $4.09 a share, and the common pays annual cash dividends of 18 cents a share.) Last year, the company generated net profit (after taxes) of $7,507,423. The company's balance sheet shows total assets of $82 million, total liabilities of $33 million, and $6 million in preferred stock. The firm's common stock is currently trading in the market at $50.82 a share. a. Given the preceding information, find the EPS, P/E ratio, and book value per share. b. What will happen to the price of the stock if EPS rises to $7.31 and the P/E ratio stays where it is? What will happen if EPS drops to $2.77 and the P/E doesn't change? c. What will happen to the price of the stock if EPS rises to $7.31 and the P/E jumps to 14.8 times earnings? d. What will happen if both EPS and the P/E ratio dropto $2.77 and 5.6 times earnings, respectively? e. Comment on the effect that EPS and the P/E ratio have on the market price of the stock. a. The firm's EPS is $. (Round to two decimal places.)