Primary Colors Has a Debt-Equity Ratio of 0

question 64

Multiple Choice

Primary Colors has a debt-equity ratio of 0.56,a return on assets of 8.2 percent,and a dividend payout ratio of 45 percent.What is the firm's rate of growth?

• A)6.04%
• B)6.52%
• C)8.13%
• D)7.04%
• E)7.26%

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Definitions:

Contribution Margin

The amount remaining from sales revenue after all variable costs have been deducted, indicating how much revenue is contributing to covering fixed costs and generating profit.

Machine Set-ups

The arrangements and adjustments made to machinery to prepare it for a production run.

Skilled Labour

Workers who have specialized training or expertise in a particular field or job.

Sunk Cost

Any cost that has already been incurred and that cannot be changed by any decision made now or in the future.