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

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As a firm grows, it must support increases in revenue with new investments in assets. The self-supporting, or sustainable, 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 in liabilities or equity). Consider the following case of Green Caterpillar Garden Supplies Inc.: Green Caterpillar Garden Supplies Inc. has no debt in its capital structure and has $200,000,000 in assets. Its sales revenues last year were $100,000,000 with a net income of $5,000,000. The company distributed $185,000 as dividends to its shareholders last year. Given the information above, what is Green Caterpillar Garden Supplies Inc.'s sustainable growth rate? 1.07% 2.47% O 0.09% 0 2.66% Which of the following are assumptions of the sustainable (self-supporting) growth model? Check all that apply. The firm maintains a constant ratio of assets to equity. The firm maintains a constant net profit margin. The firm's total asset turnover ratio remains constant. The firm's liabilities and equity must increase at the same rate

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