The P/E ratio can be expected to change as the expected dividend payout ratio changes.

Name: The P/E ratio can be expected to change as the expected dividend payout ratio changes.
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Question

Quizplus · Accepted Answer

The P/E ratio is influenced by the expected growth rate of earnings, which can be affected by changes in the dividend payout ratio. A higher payout ratio might imply lower retained earnings for growth, potentially affecting future earnings and thus the P/E ratio.

The P/E Ratio Can Be Expected to Change as the Expected