Castles in the Sand generates a rate of return of 20% on its investments and maintains...

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Finance

Castles in the Sand generates a rate of return of 20% on itsinvestments and maintains a plowback ratio of .30. Its earningsthis year will be $5 per share. Investors expect a 15% rate ofreturn on the stock.
A. Find the price and P/E ratio of the firm. (Do not roundintermediate calculations. Round your answers to 2 decimalplaces.)
B. Find the price and P/E ratio of the firm if the plowbackratio is reduced to .20. (Do not round intermediate calculations.Round your answers to 2 decimal places.)

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Castles in the Sand generates a rate of return of 20% on itsinvestments and maintains a plowback ratio of .30. Its earningsthis year will be $5 per share. Investors expect a 15% rate ofreturn on the stock.A. Find the price and P/E ratio of the firm. (Do not roundintermediate calculations. Round your answers to 2 decimalplaces.)B. Find the price and P/E ratio of the firm if the plowbackratio is reduced to .20. (Do not round intermediate calculations.Round your answers to 2 decimal places.)