Robert Half International, Inc., headquartered in Menlo Park, California, is the world's largest provider of temporary and permanent personnel in accounting and finance, with 230 offices worldwide. Following are selected financial data for the company for the period 1994-1998.

a. Calculate Robert Half's sustainable growth rate in each year.

b. Comparing the company's sustainable growth rate to its actual growth rate in sales, what growth problems does the company appear to have faced over this period?

c. How does the company appear to have coped with these problems?

d. Robert Half pays no dividends. As a shareholder, would you urge the company to pay dividends?AppendixLO1

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1994 1995 1996 1997 1998 Profit margin (%) 5.9 6.4 6.8 7.2 7.3 Retention ratio (%) 100.0 100.0 100.0 100.0 100.0 Asset turnover (X) 2.0 2.1 2.2 2.3 2.5 Financial leverage (x) 1.7 1.7 1.8 1.8 1.7 Growth rate in sales (%) 45.8 40.8 43.0 45.0 37.6