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Residual dividend model-payout ratio

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Residual dividend model: payout ratio

McClelland Industries has a capital budget of $1,500,000, but it wants to maintain a target capital structure of 30% debt and 70% equity. The company expects to pay a dividend of $450,000. If the company follows a residual dividend policy, what is its forecasted dividend payout ratio?

Reference no: EM132066771

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