Question III.3. Extra Superstore just announced it will cut its dividend to $2 per share at the end of this year and us

[answerhappygod]

Question III.3.
Extra Superstore just announced it will cut its dividend to $2 per
share at the end of this year and use the extra fund to expand its
business. Prior to the announcement, Extra’s dividend yield was
1.5%, the equity cost of capital was 8%, the dividend grew at a
constant rate. With the new expansion, Extra’s dividends are
expected to grow at a 7% rate.
a) Suppose Extra’s risk is unchanged by the new expansion, what
share price would you expect after the announcement?
b) What was the expected growth rate of Extra’s dividend prior to
the announcement?