The market consensus is that Analog Electronic Corporation has an ROE = 9% and a beta of 1.60. It plans to maintain indefinitely its traditional plowback ratio of 3/5. This year's earnings were $2.5 per share. The annual dividend was just paid. The consensus estimate of the coming year's market return is 14%, and T-bills currently offer a 5% return.

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a.) Find the price at which Analog stock should sell. (Do not round intermediate calculations. Round your answer to 2 decimal places.) b.) Suppose your research convinces you Analog will announce momentarily that it will immediately change its plowback ratio to 2/5. Find the intrinsic value of the stock. (Do not round intermediate calculations. Round your answer to 2 decimal places.)