The Internal Growth Rate of a fiRm Is Best Described

question 95

Multiple Choice

The internal growth rate of a firm is best described as:

• A) The minimum growth rate achievable if the firm does not pay out any cash dividends.
• B) The minimum growth rate achievable if the firm maintains a constant equity multiplier.
• C) The maximum growth rate achievable without external financing of any kind.
• D) The maximum growth rate achievable without using any external equity financing, while maintaining a constant debt-equity ratio.
• E) The maximum growth rate achievable without any limits on the amount of debt financing used.

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Definitions:

Deontology

Deontology is a branch of ethics that focuses on the morality of actions based on whether they adhere to established rules or duties, rather than on the consequences of the actions.

Virtue Ethics

An approach to ethics that emphasizes an individual's character as the key element of ethical thinking, rather than rules or consequences.

Utilitarianism

A theory in ethics and philosophy that evaluates actions based on their outcomes, aiming for the greatest happiness for the greatest number.

Philanthropic Activity

Actions taken by individuals or organizations to promote the welfare of others, typically in the form of charitable donations or other forms of aid.