**Question:**A firm has 80,000 shares of stock outstanding with a market price of $25 per share. If net income for the year is $200,000 and the retention ratio is 70%, what is the dividend yield on the firm's stock?**Options:**- O 2%- O 3%- O 4%- O 5%- O 6%**Explanation:**There are no graphs or diagrams in this image. The question is a multiple-choice problem related to calculating the dividend yield. It provides information on the number of shares, market price per share, net income, and retention ratio. To find the dividend yield, you need to calculate the dividends paid and then use the formula for dividend yield.

The dividend yield is calculated as the ratio of dividend per share and the market price of the…

Answered: A firm has 80,000 shares of stock…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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A firm has 80,000 shares of stock outstanding wih a market price of $25 per share. If net income for the year is $200,000 and the retention ratio is 70%, what is the dividend yield on the firm's stock? O 2% O3% O 4% O 5% O 6%