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A company has a required return of 1 6 % , a profit margin of 3 % , a D / E ratio of 1

A company has a required return of 16%, a profit margin of 3%, a D/E ratio of 1 and total asset turnover of 2 and just paid a $3.00 Dividend.Explain why the price and P/E ratio increased or decreased. What variables are critical to determine if they should increase or decrease their dividend payout ratio? (Hint be specific what variables do you need to know.)(3 points)

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