In the Model P/E = (D₁/E₁)/(k - G),the P/E Should

question 24

Essay

In the model P/E = (D₁/E₁)/(k - g),the P/E should increase if the dividend payout rate increases,other things the same.If the payout rate was intentionally increased by the board of directors,other things are likely not to stay the same.What is likely to happen to the dividend growth rate and the required return?