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Merlo, Inc. maintains a debt-equity ratio of 0.25 and follows a residual dividend policy. The company has after-tax earnings of $2,900 for the year and

Merlo, Inc. maintains a debt-equity ratio of 0.25 and follows a residual dividend policy. The company has after-tax earnings of $2,900 for the year and needs $2,500 for new investments. What is the total amount Merlo will pay out in dividends this year?

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