Castles in the Sand generates a rate of return of $20%$ on its investments and maintains a plowback ratio of 0.20 , its earnings this year Will be $$2$ per share. Investors expect a rate of return of $10%$ on the stock. a. Find the price and P/E ratio of the firm. Note: Do not round intermediate calculations. Rlound your answers to 2 declmal places. b. Find the price and P/E ratio of the firm if the plowback ratio is reduced to 0.10 . Note: 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 its investments and maintains a plowback ratio of 0.20 , its earnings this year Will be

$2

per share. Investors expect a rate of return of

10%

on the stock. a. Find the price and P/E ratio of the firm. Note: Do not round intermediate calculations. Rlound your answers to 2 declmal places. b. Find the price and P/E ratio of the firm if the plowback ratio is reduced to 0.10 . Note: Do not round intermediate calculations, Round your answers to 2 decimal places.

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