Pops Co. has an earnings per share (EPS) of $3.3. If the industrial average P/E ratio is 18, what is the fair price you are willing to pay for the stock?

a) $67.39

b) $72.94

c) $59.40

d) $47.83

Raisans Co. is paid its annual dividend of $0.90 a share. The firm recently announced that all future dividends will be increased by 2.5 percent annually. What is one share of this stock worth to you if you received a 7 percent rate of return?

a) $20.50

b) $25.47

c) $27.83

d) 18.77