The Rate at Which the Assets of a Firm Can

question 75

Multiple Choice

The rate at which the assets of a firm can grow without the requirement of any external sources of financing is the:

• A) internal growth rate.
• B) sustainable growth rate.
• C) pro forma growth rate.
• D) plowback rate.

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Definitions:

Capital Account

An account used to summarize the owner's equity in a business, including funds contributed by investors or profits retained in the business rather than distributed.

Income Sharing

A financial arrangement where profits or revenues are distributed among participants or partners, often seen in partnerships and joint ventures.

Partnership Assets

Resources owned jointly by partners in a partnership arrangement, used in the operation of the partnership business.

Cash Distribution

The payment of earnings or capital to shareholders, stakeholders, or partners by a corporation or fund.