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A Firm Has Current Aftertax Earnings of $1,000,000 and Has

Question 40

Multiple Choice

A firm has current aftertax earnings of $1,000,000 and has declared a cash dividend of $400,000. Thefirm's dividend pay-out ratio is

A) 40 percent.
B) 4.0 percent.
C) 2.5 percent.
D) 2.0 percent.

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