10 percent b. 25 percent c. 60 percent d. 80 percent

Entrepreneurial Finance
6th Edition
ISBN:9781337635653
Author:Leach
Publisher:Leach
Chapter14: Security Structures And Determining Enterprise Values
Section: Chapter Questions
Problem 12EP
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The EPS of a company is Rs 20 and discount rate is 15 percent. Retained earning can be employed to earn a return of 13%. If the dividend payout ratios of 10%, 25%, 60% and 80% are considered, which of these will maximise the value?(Use walter)
a.
10 percent
b.
25 percent
c.
60 percent
d.
80 percent
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