Alternative "What If?" Scenarios Can Be Easily Accommodated in Financial

question 12

Multiple Choice

Alternative "what if?" scenarios can be easily accommodated in financial planning by use of:

• A) sustainable growth models.
• B) planning outputs.
• C) spreadsheet programs.
• D) bond covenants.

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Definitions:

Average Collection Period (ACP)

The average amount of time it takes for a business to receive payments owed by its customers.

Revenue Forecast

An estimate of the amount of money a company expects to earn over a specific period in the future.

Sustainable Growth Rate

The maximum rate at which a company can grow without needing to increase financial leverage.

Retention Ratio

The proportion of net income that is retained by a company rather than distributed to its shareholders as dividends.