Suppose that a company forecasts after-tax earnings of 100 million net of depreciation equal to 25 million

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Suppose that a company forecasts after-tax earnings of €100 million net of depreciation equal to €25 million per year. Suppose also that it requires financing to the amount of

€ 60 million.

(a) What would be its maximum dividend payout ratio if its forecast investment were:

(i) €135 million; or

(ii) €115 million?

(b) What would the company have to do if it wants a dividend payout ratio of 20%, and to invest »135 million?

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Financial Management And Real Options

ISBN: 259088

1st Edition

Authors: Jack Broyles

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Question Posted: May 22, 2024 06:02 AM

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Suppose that a company forecasts after-tax earnings of 100 million net of depreciation equal to 25 million

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Financial Management And Real Options

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