The Risk-Free Rate of Return Is 10 Percent,and the Expected

The risk-free rate of return is 10 percent,and the expected return for the stock market is 16 percent.Evergreen Industries has a beta of 1.1,and investors expect dividends and earnings to grow at an 8 percent rate per year.The current dividend is $1.20,and the payout ratio is 50 percent.
(a)Calculate the P/E ratio for Evergreen Industries.
(b)Estimate the price of the stock for the next year using the multiplier model.