Use the Following Information for Questions

question 13

Multiple Choice

Use the following information for questions
A bank currently just meets its total capital requirements of 8%. The bank currently has a dividend payout ratio of 35%. Assets are expected to grow at 5%.
-If the bank expects its ROA to be .45%, what is the maximum dividend payout ratio to support the increase in assets?

• A) 11.1%
• B) 22.2%
• C) 33.3%
• D) 44.4%
• E) 89.9%

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Definitions:

Polyunsaturated Fats

A type of dietary fat found in foods like nuts, seeds, fish, algae, leafy greens, and vegetable oils, known for its potential benefits in reducing heart disease risk.

Hypertension

A condition where the force of the blood against the artery walls is too high, often leading to health issues such as heart disease.

Sodium

A chemical element (Na) that plays critical roles in the body, especially in fluid balance and nerve function.

Acute Pancreatitis

A sudden inflammation of the pancreas that causes severe abdominal pain and, potentially, serious complications.