Dividend payout ratio under Walter model Thankyou

7. The following figures have been collected from the annual report of ABC Ltd. for the current financial year: Net Profit 375 lakhs Outstanding 12% preference shares 250 lakhs No. of equity shares 7.50 lakhs Return on Investment 20% Cost of capital i.e. (K) 16% (a) COMPUTE the approximate dividend pay-out ratio so as to keep the share price at 42 by using Walter's model? (b) DETERMINE the optimum dividend pay-out ratio and the price of the share at such pay-out. (c) PROVE that the dividend pay-out ratio as determined above In (b) is optimum by using random pay-out ratio