Realm expects earnings per share of $$7\mathrm{.}20$ next year. Mayne Payne, CEO, has discovered an opportunity to retain and invest $60\%$ of the earnings. Mayne expects a $15\%$ return on equity $($ROE$).$ The firm$$s required return is $12\%.$

a$.$ Estimate the price per share of Realm. Will the PVGO be positive or negative? Explain.

b$.$ Realm has revised estimates. Analysts are predicting an $11\%$ per year growth in dividends over the next $3$ years. After that, dividends will grow at the current industry average of $5\%$ per year. Estimate the share price with the new information.