Permian Partners (PP) produces from aging oil fields in west Texas. Production is 1.86 million barrels per year in 2016, but production is declining at 8% per year for the foreseeable future. Costs of production, transportation, and administration add up to $25.60 per barrel. The average oil price was $65.60 per barrel in 2016. PP has 7.6 million shares outstanding. The cost of capital is 10%. All of PP's net income is distributed as dividends. For simplicity, assume that the company will stay in business forever and that costs per barrel are constant at $25.60. Also, ignore taxes. a. Assume that oil prices are expected to fall to $60.60 per barrel in 2017, $55.60 per barrel in 2018, and $50.60 per barrel in 2019. After 2019, assume a long- term trend of oil-price increases at 6% per year. What is the ending 2016 value of one PP share? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Share value2016 b-1. What is PP's EPS/P ratio? (Do not round intermediate calculations. Round your answer to 3 decimal places.) EPS/P ratio b-2. Is it equal to the 10% cost of capital? Yes No