Question
A firm has a robust ROE of 14% and decides to increase its plowback ratio. All else equal, you know that: a. earnings growth will
A firm has a robust ROE of 14% and decides to increase its plowback ratio. All else equal, you know that:
a. earnings growth will increase and the stock's P/E may or may not increase
b. earnings growth will increase and the stock's P/E will increase
c. earnings growth will increase and the stock's P/E will decrease
d.earnings growth will decrease and the stock's P/E will increase
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Corporate Finance
Authors: Stephen Ross, Randolph Westerfield, Jeffrey Jaffe
6th International Edition
0071229035, 978-0071229036
