Problem 17-20 Payout Policy (L03) Little Ol has outstanding 1 million shares with a total market value of $21 million. The firm is expected to pay $100 million of dividends next year, and thereafter the amount paid out is expected to grow by 4% a year in perpetuity. Thus, the expected vidend is $104 million in year 2, $10816 million in year and so on. However, the company has heard that the value of the depends on the flow of dividends, and therefore, it announces that next year's dividend will be increased to $2 million and that the extra cash will be raised Immediately afterward by an issue of shares. After that, the total amount paid out each year will be as previously forecasted that is $104 million in year 2 and increasing by 4 in each subsequent year a. At what price will the new shares besoed in year 17 (Do not round Intermediate calitations. Round your answer to 2 decimal places) b. How many shares will the firm need to issue? (Do not round Intermediate calculations. Hound your answer to the nearest whole numbet.) c. What will be the expected dividend payments on these new shares, and what therefore, will be paid out to the old shareholders after year 1 (Do not round Intermediate calculations, Round your answer to 2 decimal places) d. Recalculate the present value of the Price per share to current shareholders. Do not round Intermediate calculations. Round your answer to the nearest whole dolar) b Price person Number of the Dend persone Presenta d