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You are contemplating investing in a small tech firm. BVPS last year was equal to $25....

You are contemplating investing in a small tech firm. BVPS last year was equal to $25. It had an EPS of $2 this year and paid a dividend per share of $0.50. You expect it to continue to operate as it has for the foreseeable future.

a. What was the firm’s plowback ratio?

b. What was the firm’s ROE?

c. What will its growth rate be?

d. If investors expect a 10% return, what is its price?

e. What is the firm’s P/E ratio?

f. What is the present value of the firm’s growth opportunities?

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