The Sustainable Growth Rate Measures How Quickly a Firm Can

question 78

True/False

The sustainable growth rate measures how quickly a firm can increase its asset base over the next year without raising outside funds.

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Definitions:

Group Depreciation

A method of depreciating multiple assets collectively that are similar in nature and have approximately the same expected useful lives.

Business Computer

A computing device specifically designed, acquired, and used to meet the operational requirements of a business.

Double-Declining-Balance

A method of accelerated depreciation that doubles the straight-line depreciation rate, expensing more of the asset's cost closer to the beginning of its useful life.

Depreciation Expense

The allocated reduction in the value of a tangible asset over its useful life, reflecting wear and tear or obsolescence.