The Data in the Previous Question Show a Much Higher

question 12

Multiple Choice

The data in the previous question show a much higher incidence of low birth weight babies from mothers who smoke. This finding is likely to be a reliable one because

• A) everyone knows that smoking is a bad thing.
• B) the smokers rate of low birth weight is twice that of the non-smokers.
• C) the pattern of differences occurs reliably over each of 5 years.
• D) there is a general increase in low birth weight over the years.

---

Definitions:

Operating Capacity

The maximum output that a company can produce under normal conditions.

Equity Multiplier

A financial leverage ratio that measures the portion of a company's assets that are financed by shareholder's equity.

Sustainable Growth Rate

The maximum rate at which a company can grow its sales, earnings, and dividends without increasing its financial leverage or debt proportion.

Dividend Payout Ratio

The proportion of net income a firm pays out to its shareholders in the form of dividends.