"Question 7: (2 points),,QP6-26 Growth Opportunities,,The Stambaugh Corporation currently has earnings per share of $6.00. The company has no growth and pays out all earnings as dividends. It has a new project which will require an investment of $1.60 per share in one year. The project is only a two-year project, and will increase earnings in the two years following the investment by $1.80 and $2.30, respectively. Investors require a 14 percent return on Stambaugh stock.,,Requirement 1:,,What is the value per share of the company’s stock assuming the firm does not undertake the investment opportunity? (Do not include the dollar sign ($). Round your answer to 2 decimal places. (e.g., 32.16)),,Value per share$____________,,Requirement 2:,,If the company does undertake the investment, what is the value per share now? (Do not include the dollar sign ($). Round your answer to 2 decimal places. (e.g., 32.16)),Value per share $____________,,Requirement 3:,Again, assume the company undertakes the investment. What will the price per share be four years from today? (Do not include the dollar sign ($). Round your answer to 2 decimal places. (e.g., 32.16)),,Price per share $____________," ,
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