Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Tinsley, Incorporated, wishes to maintain a growth rate of 15 percent per year and a debt-equity ratio of .5. The profit margin is 5.6 percent,

image text in transcribed
Tinsley, Incorporated, wishes to maintain a growth rate of 15 percent per year and a debt-equity ratio of .5. The profit margin is 5.6 percent, and the ratio of total assets to sales is constant at 1.75. What dividend payout ratio is necessary to achieve this growth rate under these constraints? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answer as a percent rounded to the nearest whole nuntber, e.g., 32.) Payout ratio % Is this growth rate possible? Yes No What is the maximum sustainable growth rate possible given these constraints? (Do not round intermediate calculations and enter your anger as a percent rounded to 2 decimal places, e.g., 32.16.) Sustainable growth rate

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

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

Step: 2

blur-text-image

Step: 3

blur-text-image

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

Finance For Non Financial Managers

Authors: Pierre Bergeron

6th Edition

0176501630, 9780176501631

More Books

Students also viewed these Finance questions

Question

Referring to the taxonomy of costs (Figure

Answered: 1 week ago