7. Hixton Farms has a target payout ratio of50%. Dividends paid last year amounted to $10 million. Its earnings were $20 million. Hixton's "speed of adjustment"

factor for dividends is 60%. What will be its dividend payments over the next five years if its earnings display the following path:

Draw a graph of Hixton's actual dividends paid versus the desired dividend payments over this five-year period.

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Year 1 2 3 5 Earnings $30 million 35 million 30 million 25 million 30 million