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Sagot :
It is $525,000.
If the dividend payout ratio is 30% ,then retention rate will be 70%
Additional Retention = $750,000* 70%
=$525,000
Additional amount retained can be used for future business expansion and can also be used to buy back shares provided there is no available profitable investment project to invest in.
Here, the retention rate is very high which implies that the company has prospective investment to put the money into to generate additional returns.
Investors will therefore settle for capital appreciation resulting from increase in share price as result of additional earnings from profit plugged back into the business.
To learn more about Dividend Payout Ratio here
https://brainly.com/question/19338996
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