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One Common Method of Estimating the Growth Rate of Dividends

Question 40

Multiple Choice

One common method of estimating the growth rate of dividends is to


A) multiply the return on equity by the dividend payout ratio.
B) randomly assign an annual growth rate of 4% to the latest dividend amount.
C) multiply the return on equity by the firm's retention rate.
D) multiply the return on assets by the dividend payout ratio.

Correct Answer:

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