Which One of the Following Correctly Defines the Retention Ratio

question 67

Multiple Choice

Which one of the following correctly defines the retention ratio?

• A)one plus the dividend payout ratio
• B)addition to retained earnings divided by net income
• C)addition to retained earnings divided by dividends paid
• D)net income minus additions to retained earnings
• E)net income minus cash dividends

---

Definitions:

Valid

Refers to the extent to which a concept, conclusion, or measurement is well-founded and corresponds accurately to the real world.

Criterion Validity

Criterion validity refers to how well one measure predicts an outcome based on the criteria of another measure.

Future Setting

A scenario or context that is projected or anticipated to occur in a forward time frame.

Interrater Reliability

The level of agreement among multiple observers or raters on the assessment of a particular characteristic or attribute.