Identify, within the context of the constant dividend growth model, how each of the following factors will

Question:

Identify, within the context of the constant growth model, how each of the following factors will affect the P/E ratio of Sundanci. In other words, will each of the following factors increase, decrease, or possibly increase or decrease the P/E ratio? Assume all other factors remain constant.
a. The beta of Sundanci increases substantially.
b. The estimated growth rate of Sundanci's earnings and dividends increases.
c. The payout ratio of Sundanci increases.
d. The market risk premium increases.

Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...