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As a firm grows, it must support increases in revenue with new investments in assets. The self-supporting growth model helps a firm assess how rapidly

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As a firm grows, it must support increases in revenue with new investments in assets. The self-supporting growth model helps a firm assess how rapidly it can grow, while maintaining a balance between its cash outflows (increases in noncash assets) and inflows (funds resulting from increases liabilities or equity). Consider this case: Blue Elk Manufacturing has no debt in its capital structure and has $200 million in assets. Its sales revenues last year were $100 million with a net income of $5 million. The company distributed $1.35 million as dividends to its shareholders last year. What is the firm's self-supporting, growth rate? (Note: Do not round your intermediate calculations.) 0.68% 1.86% 0.79% 3.28% Which of the following are assumptions of the self-supporting growth model? Check all that apply. The firm maintains a constant ratio of liabilities to equity. The firm's liabilities and equity must increase at the same rate. Common stock is the firm's only form of equity. The firm pays no dividends

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