Multiple Choice
Which of the following is incorrect for a firm with a payout ratio of 0.15 and ROE of 20 percent:
A) It reinvests 85 percent of its earnings back into the firm
B) The firm's retained earnings will increase the book value of equity by 17 percent
C) It pays a dividend of 15 cents per share
D) The firm's earnings and equity will grow by 17 percent per year
Correct Answer:
Verified
Correct Answer:
Verified
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