Planners Have Determined That Sales Will Increase by 20% Next

question 46

Multiple Choice

Planners have determined that sales will increase by 20% next year,and the profit margin will remain at 10% of sales.Which one of the following statements is correct if the payout ratio remains at 30%?

• A) Net income will increase by 10% next year.
• B) The addition to retained earnings will increase by 20% next year.
• C) The dividend will increase by 6% next year.
• D) The addition to retained earnings will equal 6% of the sales increase next year.

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Definitions:

Birthrates

The ratio of live births in an area to the population of that area over a year, typically expressed per 1000 inhabitants.

Economic View

A perspective or analysis regarding how economic forces interact, including considerations of markets, resource allocations, and the impacts of policies.

Demographers

Experts who study population dynamics, including birth rates, death rates, and migration patterns, to understand population changes.

Birthrates

The number of live births per thousand people in a population over a specific period of time.