a. Calculate Robert Halfs sustainable growth rate in each year.

b. Comparing the companys sustainable growth rate with its actual growth rate in sales, what growth problems did the company face over this period?

c. Considering economic conditions over the period, what was a likely cause of these problems?

d. Robert Half paid its first dividends in 2004. As an analyst, assess the companys decision to pay dividends.

e. Calculate Robert Halfs sustainable growth in 2004 assuming a financial leverage ratio of 2.5. If Robert Half adopts this leverage target, how would this change your answer in part (d)?

2003 0.32% 100.00 Profit margin Retention ratio Asset turnover Financial Leverage, T=A/E Growth rate in sales 2000 6.89% 100.00 2.78 4.69 22.89% 2001 4.94% 100.00 2.47 1.38 -10.05% 2002 0.11% 100.00 2.03 1.16 -28.76% 2004 5.25% 78.27 2.23 1.52 26.19% 2.00 1.32 3.55% 2003 0.32% 100.00 Profit margin Retention ratio Asset turnover Financial Leverage, T=A/E Growth rate in sales 2000 6.89% 100.00 2.78 4.69 22.89% 2001 4.94% 100.00 2.47 1.38 -10.05% 2002 0.11% 100.00 2.03 1.16 -28.76% 2004 5.25% 78.27 2.23 1.52 26.19% 2.00 1.32 3.55%