What effect will a yearend increase in the market price of a

What effect will a year-end increase in the market price of a corporation\'s common stock have on the following ratios?

Choose:

A.) A

B.) B

C.) C

D.) D

	Return on common stockholder\'s equity	Dividend Payout Ratio
A	No effect	No effect
B	Increase	No effect
C	Decrease	Decrease
D	Decrease	No effect

The correct option is

A) A

Increase in Market price will have no effect on Return on investment and no effect on the Dividend Payout Ratio.

Dividend Payout Ratio = Dividend/ Earnings

Return on Investment = Net Income/ Investment