A Firm That Wants to Increase Its Sustainable Growth Rate

question 25

Multiple Choice

A firm that wants to increase its sustainable growth rate can do so by __________ the __________ ratio or by __________ the __________ or both.

• A) Increasing; payout; increasing; ROE
• B) Increasing; plowback; increasing; ROE
• C) Decreasing; plowback; increasing; ROE
• D) Decreasing; payout; decreasing; ROE

---

Definitions:

Standard Deviation

A construct for gauging the extent of variability or dissimilarity in a collection of data points.

Normal Model

Another term for a normal distribution, a bell-shaped curve that shows the distribution of data with a specific mean and standard deviation.

Standard Deviation

An index indicating the amount by which individuals within a data set tend to deviate from the average or mean value.

Normal Model

A statistical model that describes data that clusters around a mean in a symmetrical, bell-shaped distribution.