What Is the Required Asset Turnover for a Firm with a 12

question 67

Multiple Choice

What is the required asset turnover for a firm with a 12% profit margin, 50% equity, and a 40% dividend payout that wishes to grow at 6% without increasing financial leverage?

• A) 0.42
• B) 0.56
• C) 0.63
• D)1.00

---

Definitions:

Milli-

A prefix in the metric system denoting a factor of one thousandth (1/1000) of the unit it precedes.

Metric System

A system of measurements that uses the base function of 10.

Base Ten

A numeral system that is decimal and uses ten as its base for counting and calculations.

Teaspoon

A small spoon used typically for measuring or stirring liquids, equivalent to about 5 milliliters in volume.