The market consensus is that Analog Electronic Corporation has an ROE = 11% and a beta of 1.55. It plans to maintain indefinitely its traditional plowback ratio of 2/5. This year's earnings were $3.8 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 6% return.

a.	Find the price at which Analog stock should sell. (Do not round intermediate calculations. Round your answer to 2 decimal places.)

Price

$

b.	Suppose your research convinces you Analog will announce momentarily that it will immediately change its plowback ratio to 3/5. Find the intrinsic value of the stock. (Do not round intermediate calculations. Round your answer to 2 decimal places.)

Intrinsic value of the stock