00:01
So here in this question, first we calculate the share price, the share price, and the share price is present value of future cash flows upon the number of shares, that is, 15 ,900 ,000 upon 475 ,000, and that is equals to $33 .47.
00:22
Then we determine the dividend payout and its effect, the complete plans to pay out 50 % of its current cash flows as dividends.
00:29
So current cash flows, current cash flows, cash flows, is equals to 1 .2 million minus the dividend payout, minus the 1 .2 million minus dividend payout, so the dividend payout.
00:55
So the dividend payout is equal to $0 .6.
01:02
Million upon 475 ,000 that is 1 .26 dollars now explained how jeff miller can achieve a zero payout policy jeff haunts 1 ,000 shares he will receive dividends so jeff dividends dividends dividends are 1 ,000 shares into 1 .26 per share that is 1260 to achieve if we were zero payout policy, jf can reinvest 1260 to buy more shares...