What is the sustainable rate of growth on these general accounting question? The Green Giant has a 5% profit marginand a 36% dividend payout ratio. Thetotal asset turnover is 1.4 and the equitymultiplier is 1.4.What is the sustainable rate of growth?

The problem requires the determination of the sustainable growth rate.The sustainable growth rate…

Answered: The Green Giant has a 5% profit margin…

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter8: Basic Stock Valuation

Section: Chapter Questions

Problem 11MC

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Assume that the following ratios are constant. Total asset turnover 1.37, profit margin 6.9%, equity multiplier 1.7, payout ratio 57%. What is the sustainable growth rate?
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9) The Green Giant has a 5 percent profit margin and a 40 percent dividend payout ratio. The total asset turnover is 1.2 times and the equity multiplier is 1.5 times. What is the sustainable rate of growth?
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The Green Giant has a 6 percent profit margin and a 37 percent dividend payout ratio. The total asset turnover is 1.2 times and the equity multiplier is 1.4 times. What is the sustainable rate of growth? A) 6.78% B) 1.68% C) 10.36% D) 10.08% E) 9.49%
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Stop and Go has a 4.5 percent profit margin and a 15 percent dividend payout ratio. The total asset turnover is 1.6 and the financial leverage is 1.60. What is the sustainable rate of growth? O a. 9.13 percent O b. 9.89 percent O c. 10.85 percent O d. 9.54 percent
Accounting. Stop and go has a 4.5 percent profit margin and a 15 percent dividend payout ratio.
Firm B has a capital intensity ratio of 2,optimal debt equity ratio of 1.5, and dividend payout ratio of 0.5. What profit margin must the firm achieve in orderto grow at a rate of 15% without new equity issue?

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The Green Giant has a 5% profit margin and a 36% dividend payout ratio. The total asset turnover is 1.4 and the equity multiplier is 1.4. What is the sustainable rate of growth?