Question: The information below is available for two companies that are both listed on the stock exchange. Required: Explain in your own words what each of:

The information below is available for two companies that are both listed on the stock exchange.

Required:
Explain in your own words what each of:
a) The dividend payout ratio
b) The price earnings ratio is intended to measure (do not just give the formula for the ratio) and, discuss what the ratio results reveal about the differences between the two companies to a potential investor.

Dividend payout ratio Price earnings ratio Black Ltd 80% 12:1 Grey Ltd 25% 15:1

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