Use the Following Information to Estimate a Venture's Sustainable Growth

question 34

Multiple Choice

Use the following information to estimate a venture's sustainable growth rate: Net income = $200,000; Total assets = $1,000,000; equity multiple based on beginning common equity = 2.0 times; and Retention rate = 25%.

• A) 50%
• B) 25%
• C) 20%
• D) 10%
• E) 5%

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Definitions:

SIDE

The Social Identity model of Deindividuation Effects; a theory explaining how group identity and anonymity can influence behaviors in group settings.

Optimal Distinctiveness

People strive to achieve a balance between conflicting motives for inclusiveness and separateness, expressed in groups as a balance between intragroup differentiation and intragroup homogenisation.

Social Mobility

The ability for individuals or families to move up or down the socioeconomic ladder within a society.

Metacontrast Principle

A phenomenon in social identity and group behavior, where contrast between in-group and out-group members is maximized in the perceivers' mind.