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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