Which is a valid counterargument to the call for higher tariffs to save u.s. jobs? imports may eliminate some u.s. jobs, but the
1 answer:
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Answer: The dividend payout ratio is 46.19%.
We follow these steps in order to arrive at the answer:
We begin with the DuPont identity of RoE.
<u>DuPont Identity:</u>
Now,
And Debt Ratio is also expressed as:
where D/E represents the Debt-Equity Ratio.
Substituting the value of D/E ratio from the question in the debt ratio formula above we get,
----(1)
Substituting (1) in the equity multiplier formula above we get,
Substituting Equity Multiplier from above and the relevant numbers from the question in the DuPont identity we get,
The relationship between RoE and earnings growth rate g is given by the following formula:
, where p is the dividend payout ratio.
Plugging in the values in the formula above we get,
p = 0.461988304 or 46.19%
Answer:
option (d) $929.42
Explanation:
Data provided in the question:
Coupon bonds payments = 5.65% semiannual
Yield to maturity, r = 6.94% = 0.0694
Face value = $1000
Now,
Coupon bond payments = × $1,000
= $28.25
market price per bond = Payment × +
Here,
n is the maturity period and 2n is due to the semiannual payments
Thus,
market price per bond = $28.25 × +
= $28.25 × 10.942 + 620.3
= $929.42
Hence,
The answer is option (d) $929.42