You Expect KT Industries (KTI)will Have Earnings Per Share of $3

question 37

Multiple Choice

You expect KT Industries (KTI) will have earnings per share of $3 this year and expect that they will pay out $1.50 of these earnings to shareholders in the form of a dividend.KTI's return on new investments is 15% and their equity cost of capital is 12%.The expected growth rate for KTI's dividends is closest to:

• A)6.0%.
• B)7.5%.
• C)4.5%.
• D)3.0%.

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Definitions:

Anchor

A device, usually made of metal, used to connect a vessel to the bed of a body of water to prevent the craft from drifting due to wind or current.

Internal Friction Surface

The surface within a mechanical system where internal friction occurs, often influencing the efficiency and wear of the system.

Shoes

Footwear made from various materials, designed to protect and comfort the human foot while doing various activities.

Backing Plate

A component of drum brakes that holds the brake assembly together against the drum.