Which of the Following Formulas Is INCORRECT

question 58

Multiple Choice

Which of the following formulas is INCORRECT?

• A) Divt = EPSt × Dividend Payout Rate
• B) PN = (rE - g) × DivN+1
• C) earnings growth rate = retention rate × return on new investment
• D) rE = (Divt / P0) + g

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Definitions:

Transfer Price

The price charged for goods, services, or intellectual property when these are exchanged between divisions within the same company.

Division Using

Refers to the allocation or utilization of resources or responsibilities among different departments or sectors within an organization.

Intermediate Product

A product that is used as an input in the production of another good rather than being sold directly to consumers.

Transfer Price

Transfer price is the price at which goods and services are sold between departments or subsidiaries within the same company.