Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Jul 27, 2024

A firm has an ROE of 20% and a debt-equity ratio of 40%. If it wishes to grow by 9% a year without external financing,

A firm has an ROE of 20% and a debt-equity ratio of 40%. If it wishes to grow by 9% a year without external financing, what is the maximum proportion of earnings that it can pay out?

A. 40%

B. 12%

C. 37%

D. 16%

Step by Step Solution

There are 3 Steps involved in it

Step: 1

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

Step: 3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Personal Finance

Authors: Jack Kapoor, Les R. Dlabay, Robert J. Hughes

2nd Edition

0256079056, 9780256079050

More Books

Students also viewed these Finance questions

Question

★★★★★

Given the transition rules AC B, B AC, CD E, and ECD, draw the Petri net described. From the Petri net, draw the finite state graph reachable from the initial state ACD. What well-known concept do...

Answered: 1 week ago

Question

★★★★★

Kethans employment contract with MedEcon contained a noncompetitive clause providing he could not work for a competitor for two years after leaving. It also had geographic restrictions. Kethan worked...

Answered: 1 week ago

Question

★★★★★

Am I trying to change or control others?

Answered: 1 week ago

Question

★★★★★

Change in Estimate Assume that Bloomer Company purchased a new machine on January 1, 2010, for $80,000. The machine has an estimated useful life of nine years and a residual value of $8,000. Bloomer...

Answered: 1 week ago

Question

★★★★★

2) RS 3) R3 380 4) R3 460 5) R3 360 which one of the following statements is correct M) VAT output is repaid by SARS The debit balance of the VAT control account indicates the amount owed by SARS 13)...

Answered: 1 week ago

Question

★★★★★

2. What is the pressure in pascals if a force of 3.44 104 MN is pressed against an area of 1.09 km2 ? 3. What is the final temperature of a gas whose initial conditions are 667 mL, 822 torr, and...

Answered: 1 week ago

Question

★★★★★

A random sample of 45 Burger King Whoppers found a sample mean weight of 120g and a sample standard deviation of 15g. Find the 90% confidence interval of the true mean weight of a Whopper. Write your...

Answered: 1 week ago

Question

★★★★★

Ignoring GST, which of the following entries correctly records the purchase of land for $300 000 financed by a $100 000 cash deposit with the balance payable via a 20-year, 6% loan? Select one: a. DR...

Answered: 1 week ago

Question

★★★★★

Sizwe conditioners a manufacturing firm based in Gauteng makes three different types of air conditioners: the ceiling type, the cassette type and the wall mounted type. Weekly sales of each type are...

Answered: 1 week ago

Question

★★★★★

Scenario 1 Danielle is the office manager of a large business in the city. She is the only female staff member at the management level. The CEO (who is significantly older than her) often refers to...

Answered: 1 week ago

Question

★★★★★

987 Co. grants 123 Limited a sole license for the 987 CRM Software. Who may use the 987 CRM Software? O a. Only 123 O b. Only 987 O c. 123 and other licensees O d. 987 and the licensee

Answered: 1 week ago

Question

★★★★★

1 D o you think organisations should adopt a return on investment approach? Phillips (2005), in response to the regular calls for a way of measuring the contribution of training, has developed an...

Answered: 1 week ago

Question

★★★★★

1 Consider ways to facilitate real world employee learning in a training programme. Pitney Bowes is a 90year- old American company with headquarters in Harlow, Essex, UK. The company offers software,...

Answered: 1 week ago

Question

★★★★★

4 How can reward systems be used to engage staff? Provide examples to illustrate your answer.

Answered: 1 week ago

Previous Question Next Question