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Last year, a company earned $8.00 a share and paid a dividend of $2.00 a share. The companys return on equity is 12%, meaning that
Last year, a company earned $8.00 a share and paid a dividend of $2.00 a share. The companys return on equity is 12%, meaning that it generates $12.00 of earnings for every $100 which shareholders invest in the company by buying stock or by allowing the company to retain earnings. Assuming the company continues to pay out as a dividend the same per cent of earnings which it paid out last year and that its return on equity continues to be 12%, what will its earnings and dividend growth rate be? Not using Microsoft excel
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