Q2 doesn’t make sense to me. The target payout ratio is 35% after 5 years.

Expected Dividend= Last dividend + (Increase in earnings × Target payout ratio × Adjustment factor)

Expected dividend = 3.42 + (8.05 – 6.60) × 0.35 × 0.20 = $3.52

Imagine the increase in earnings is nil for 5 consecutive years. So the expected dividends, using the above formula, will be 3.42 + 0 every year. In other words the formula doesn’t slowly lead us to the target which would be 6.6*0.35=$2.31