In the Model P/E = (D₁/E₁)/(k - G), the P/E

question 83

Essay

In the model P/E = (D₁/E₁)/(k - g), the P/E should increase if the dividend payout ratio increases, other things the same. If the payout ratio was intentionally increased by the board of directors, other things are likely not to stay the same. What is likely to happen to the dividend growth rate and the required return?

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Definitions:

Effect Size

A quantitative measure of the magnitude of a phenomenon, effect, or difference, used to understand the significance of research outcomes.

Funder and Ozer

Researchers known for their work in psychology, particularly in the field of personality psychology and the comparison of correlational strengths.

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Research aimed at understanding how the thoughts, feelings, and behaviors of individuals are influenced by the actual, imagined, or implied presence of others.