A firm cuts its dividend payout ratio. As a result, you know that the firm's ________.

Name: A firm cuts its dividend payout ratio. As a result, you know that the firm's ________.
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Question

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When a firm cuts its dividend payout ratio, it means the firm is retaining a larger portion of its earnings rather than distributing them as dividends. This increases the earnings retention ratio, which is the proportion of net income that is retained rather than paid out as dividends.

A Firm Cuts Its Dividend Payout Ratio