If a Firm with a Positive Net Worth Is Operating

question 31

True/False

If a firm with a positive net worth is operating its fixed assets at full capacity, if its dividend payout ratio is 100%, and if it wants to hold all financial ratios constant, then for any positive growth rate in sales, it will require external financing.

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Definitions:

All-or-None

A principle that states a neuron fires with the same potency each time, though action is dependent on whether or not the stimulus meets the threshold.

Action Potential

A temporary reversal of the electrical polarization of the membrane of a neuron or muscle cell, allowing for the transmission of signals.

Neuron

A cell of the nervous system that transmits information through electrical and chemical signals.

Postsynaptic Potential

A change in membrane potential of the postsynaptic terminal of a synapse, typically induced by the binding of neurotransmitters.