In 2018, Ajax Ltd. completed a very successful year with an increase in its net income of over 20%. Most of this increase occurred because a new manufacturing plant was built almost exclusively through the use of borrowed funds. To conserve cash for further expansion, the board of directors increased the dividend in 2018 by only 3%. Because of this, the company's share price rose by only 6% in that year.
(a) What ratio increased the most in 2018: return on assets or return on common shareholders' equity? Why?
(b) Did the payout, price-earnings, and dividend yield ratios increase or decrease in 2018? Why?