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A company with $100 million Net Income and 50 million shares outstanding uses a residual dividend policy and has declared an annual dividend of $0.8

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A company with $100 million Net Income and 50 million shares outstanding uses a residual dividend policy and has declared an annual dividend of $0.8 per share. The company plans to borrow $15 million in new debt. The payout ratio is: 0.2 0.8 0.4 1 0.6

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