If the coming years earnings are expected to be 220 per


MF Corp. has an ROE of 13% and a plowback ratio of 70%. The market capitalization rate is 12%.

a. If the coming year's earnings are expected to be $2.20 per share, at what price will the stock sell? (Do not round intermediate calculations. Round your answer to 2 decimal places. Omit the "$" sign in your response.)

Price $ _____ ?

b. What price do you expect MF shares to sell for in 2 years? (Do not round intermediate calculations. Round your answer to 2 decimal places. Omit the "$" sign in your response.)

Price $ _____ ?

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Financial Management: If the coming years earnings are expected to be 220 per
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