If a Company Has a 100% Dividend Payout Ratio and Expected

question 32

Multiple Choice

If a company has a 100% dividend payout ratio and expected growth in earnings is zero. Cost of capital is 9%. Its P/E ratio would be expected to be:

• A) 8.33
• B) 9.33
• C) 10
• D) 11.11

Differentiate between various types of financial analysis strategies and their purposes.

Comprehend the factors affecting earnings per share and price/earnings ratio.

Recognize the impact of external factors on investment evaluation and company performance.

Discern the use of asset, liability, and equity ratios in evaluating company efficiency.

---

Definitions:

Inversely Proportional

A relationship between two variables where as one variable increases, the other decreases at a consistent rate, and vice versa.

Enzyme Concentration

The amount of enzyme present in a solution, which affects the rate of enzyme-catalyzed reactions.

Energy Of Activation

The minimum amount of energy that reacting species must have in order to undergo a specified reaction.

Enzyme

Biological molecules (typically proteins) that significantly speed up the rate of virtually all of the chemical reactions that take place within cells.