If NI were $350,000, or $700,000, what would the dividend be?

• NI = $350,000: Need $480,000 of equity, so should retain the whole $350,000. Dividend = $0.

• NI = $700,000: Dividend = $700,000 - $480,000

= $220,000.Payout = $220/$600 = 37%.

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