Company Qs current return on equity (ROE) is 20%. It currently pays out earnings as cash dividends using a payout ratio of 0.5. Current book value per share, i.e. at the start of year 1, is $50. Book value per share will grow as Q reinvests earnings.

Assume that the ROE and payout ratio stay constant at their current levels for the next three years. After that, i.e. starting in year 4 and going on forever thereafter, competition forces ROE down to 10% and the payout ratio increases to 0.8. The cost of capital is 10%.

a.	What are Qs EPS and dividends in years 1, 2, 3, 4, and 5? (Do not round intermediate calculations. Round your answers to 2 decimal places.)

Year	EPS	Dividends
1	$	$
2	$	$
3	$	$
4	$	$
5	$	$

b.	What is Qs stock worth per share? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

Stock worth per share

$

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