If a Firm Uses External Financing as a Plug Item,has

question 17

Multiple Choice

If a firm uses external financing as a plug item,has a new capital budget of $2 million,a net income of $3 million,and a plowback ratio of 40%,how much should be raised in external funds?

• A) $200,000
• B) $600,000
• C) $800,000
• D) $1,200,000

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Definitions:

Cerebrum

The Cerebrum is the largest part of the brain, encompassing areas involved in sensory processing, voluntary movements, learning, memory, and complex cognitive processes.

Corpus Callosum

The corpus callosum is a thick band of nerve fibers that divides the cerebral cortex lobes into left and right hemispheres, facilitating communication between the two sides of the brain.

Hippocampus

A region of the brain that is associated with memory formation and spatial navigation.

Cerebral Cortex

The outer layer of the brain's cerebrum, responsible for higher brain functions including sensation, voluntary muscle movement, thought, reasoning, and memory.