Question
A firm has just completed their review of proposed projects for the coming year and has determined that they would like to invest a total
A firm has just completed their review of proposed projects for the coming year and has determined that they would like to invest a total of $219,000 in new projects. The firm follows a residual dividend policy and has a target debt-equity ratio 0.6. The firm wants to pay dividends totaling $39,500 this year. To do so, how much must the firm earn in aftertax income this year?
| a. | $156,400 | |
| b. | $176,375 | |
| c. | $107,125 | |
| d. | $244,000 | |
| e. | $161,875 |
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Public Finance In A Changing World
Authors: Peter Birch Sorensen
1998th Edition
0333682211, 978-0333682210
