(Solved): Even Better Products has come out with an even better product. As a result, the firm projects an R ...

Even Better Products has come out with an even better product. As a result, the firm projects an ROE of \( 30 \% \), and it will maintain a plowback ratio of \( 0.30 \). Its earnings this year will be \( \$ 2 \) per share. Investors expect a \( 14 \% \) rate of return on the stock. Required: a. At what price and P/E ratio would you expect the firm to sell? (Do not round intermediate calculations. Round your answers to 2 decimal places.) b. What is the present value of growth opportunities? (Do not round intermediate calculations. Round your answer to 2 decimal places.) c. What would be the P/E ratio and the present value of growth opportunities if the firm planned to reinvest only \( 20 \% \) of its earnings? (Do not round intermediate calculations. Round your answers to 2 decimal places.)