Acme Consolidated Has a Return on Equity of 12

question 23

Multiple Choice

Acme Consolidated has a return on equity of 12%.If Acme distributes 60% of earnings as dividends, then we would expect the common shareholders' investment in the firm and the value of the ordinary shares to grow by

• A)4.80%.
• B)7.20%.
• C)12%.
• D)6%.

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Definitions:

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