What Is the Return on Equity for a Firm That

question 132

Multiple Choice

What is the return on equity for a firm that has a constant dividend growth rate of 7 percent and a dividend payout ratio of 60 percent?

• A)2.80 percent
• B)4.20 percent
• C)11.67 percent
• D)17.50 percent 7% = ROE x plowback ratio
• = ROE x (1 - .6)
• = ROE x .4

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Definitions:

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The act of receiving a regular payment in exchange for labor or services provided on an hourly, daily, or piecework basis.

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Successful Employees

Individuals who achieve their goals and contribute positively to their organization's objectives, often demonstrating skills like teamwork, leadership, and problem-solving.

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The abilities and knowledge required to operate machinery in mills that process materials such as textiles, lumber, or metals.