A Firm Has Current After-Tax Earnings of $1,000,000 and Has

question 75

Multiple Choice

A firm has current after-tax earnings of $1,000,000 and has declared a cash dividend of $400,000. The firm's dividend payout ratio is ________.

• A) 2.5 percent
• B) 2.0 percent
• C) 4.0 percent
• D) 40 percent