Find firm-s optimal dividend payout ratio


Owens Manufacturing has generated a net income of $ 750,000 for 2007. It has identified investment opportunities for 2008 totaling $ 900,000. If the firm has a target capital structure of 70% equity, and 30% debt, the firm's optimal dividend payout ratio (assuming only retained earnings will be used) under the residual model is?

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Finance Basics: Find firm-s optimal dividend payout ratio
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