The Dividend Payout Ratio for the Aggregate Market Is 65

question 138

Multiple Choice

The dividend payout ratio for the aggregate market is 65 percent, the required rate of return is 12 percent, and the expected growth rate for dividends is 6 percent. Compute the current earnings multiple.

• A) 5.41
• B) 16.25
• C) 6.25
• D) 10.83
• E) 11.58

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Definitions:

DRL

Differential Reinforcement of Low Rates, a behavior modification technique used to encourage low rates of a particular behavior.

DRO Schedule

Differential Reinforcement of Other behavior, a procedure that reinforces an organism for displaying any behavior other than a target behavior.

Frustration Theory

A psychological theory suggesting that frustration, resulting from blocked goals, can lead to aggressive behavior.

Sequential Theory

A theory suggesting that understanding and behavior result from sequences of stimuli and responses, often emphasizing the importance of order in learning processes.