Market analysts expect the earnings per share of Dazza Corp to be $2.00 next year. The earnings

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Question:

Market analysts expect the earnings per share of Dazza Corp to be $2.00 next year. The earnings per share are expected to grow at 8% p.a. forever and the firm typically retains 80% of its earnings. Analysts believe that this policy will continue in the foreseeable future. If investors require a return of 12%, the company's expected (or forward) price-to-earnings ratio will be closest to:

Group of answer choices

20.00.

5.00.

6.70.

10.00.