Answer: 64%.

**Explanation:** The correct answer is **C (64%)**. According to the Gordon growth model, the dividend payout ratio (p) can be derived using the formula: \[ p = \text{Forward P/E} \times (r - g) \] Where: - \( r \) = Required rate of return (12%) - \( g \) = Dividend growth rate (4%) Substituting the given values: \[ p = 8 \times (0.12 - 0.04) = 8 \times 0.08 = 0.64 = 64\% \] **Why the other options are incorrect:** - **A (8%)**: This incorrectly equates the dividend payout ratio to the dividend yield (\( \frac{r - g}{1} \)), resulting in 8%. - **B (33%)**: This miscalculates the dividend payout ratio as the dividend growth rate divided by the required rate of return (\( \frac{g}{r} \)), yielding approximately 33%.

Author: LeetQuiz Editorial Team