Which of the following formulas is INCORRECT? g = retention rate × return on new investment. When return on equity is equal to the cost of equity, shareholders will prefer the firms' management to...

g = retention rate × return on new investment.

When return on equity is equal to the cost of equity, shareholders will prefer the firms' management to increase the payout ratio.

When return on new investment is more than the cost of equity, the share price is expected to increase.

g = (1 – payout rate) x return on new investment.