Tarmac Airlines has 115 million shares outstanding and expects earnings at the end of this year of $370 million. Tarmac plans to pay out 40% of its earnings as a dividend and 20% of its earnings through share repurchases. The firm has an equity cost of capital of 8%. If Tarmac' earnings are expected to grow by 3% per year and these payout rates remain constant, what is Tarmac's share price?

Question 7 options:

A)

$64.35

B)

$24.13

C)

$16.09

D)

$38.61

E)

$25.74