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Basic Question 14 of 16
If a company's dividend payout ratio is 20%, then its retention rate is ______.
B. 80%
C. 25%
A. 5 times
B. 80%
C. 25%
User Contributed Comments 9
| User | Comment |
|---|---|
| Done | If you get this one wrong you have issues |
| Nikita | I almost did, was thinking too much ha. |
| Masterkang | What is there to think about? |
| eb2568 | Now that is my kind of question! |
| tochiejehu | easy one dear |
| praj24 | Snap! kept thinking it's too good to be true :P |
| nabada0419 | Retention Ratio = (NI - Div)/ NI = 1 - Div Payout Ratio |
| Inaganti6 | Don't show up at the exam if you got this wrong. |
| MathLoser | I have tissue |
I just wanted to share the good news that I passed CFA Level I!!! Thank you for your help - I think the online question bank helped cut the clutter and made a positive difference.
Edward Liu
Learning Outcome Statements
explain the rationale for using present value models to value equity and describe the dividend discount and free-cash-flow-to-equity models
calculate and interpret the intrinsic value of an equity security based on the Gordon (constant) growth dividend discount model or a two-stage dividend discount model, as appropriate
identify characteristics of companies for which the constant growth or a multistage dividend discount model is appropriate
explain advantages and disadvantages of each category of valuation model
CFA® 2025 Level I Curriculum, Volume 3, Module 8.