A Payout Ratio of 35% for a Company Indicates That

question 124

Multiple Choice

A payout ratio of 35% for a company indicates that:

• A) 35% of dividends are plowed back for growth.
• B) 65% of dividends are plowed back for growth.
• C) 65% of earnings are paid out as dividends.
• D) 35% of earnings are paid out as dividends.

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Definitions:

Frictional

Pertaining to the period of time and inefficiency in processes where resources, especially labor, move from one employment to another, contributing to transient joblessness.

Unemployment Rate

The portion of the labor market that is out of work and actively pursuing job opportunities.

Decades

Periods of ten years, used as a measure of time to describe longer trends in history, economics, or demography.

Cyclical Unemployment

This refers to unemployment that occurs due to fluctuations in the economy, often increasing during a recession and decreasing during an economic expansion.