On March $11,1999,$ the New York Stock Exchange Composite was trading at $18$ times earnings, $($a market level P$/$E ratio$)$ and the average dividend yield $($D$/$P$)$ across stocks on the exchange was $3\mathrm{.}5\%.$ The treasury bond rate on March $11,1994,$ was $7\%.$ The economy was expected to grow $2\mathrm{.}5\%$ a year $($in real terms$),$ in the long term, and the estimate for inflation, in the long term, was $3\mathrm{.}5\%.$ The NYSE is a broad market index which presents the average market systematic risk. Using the fisher effect: Expected Growth Rate $=(1+$Real Growth Rate$)(1+$ Expected Inflation$)-1$

A$.$ Based upon these inputs, estimate the appropriate P$/$E ratio for the exchange.

B$.$ What growth rate in dividends$/$earnings would justify the P$/$E ratio on March $11,1999?$