Which of the Following Is the Correct Formula for Calculating

question 11

Multiple Choice

Which of the following is the correct formula for calculating sustainable growth rate?

• A) Sustainable growth rate = Return on sales × Return on equity
• B) Sustainable growth rate = Retention ratio × Return on equity
• C) Sustainable growth rate = Retention ratio × Return on assets
• D) Sustainable growth rate = Return on sales × Return on assets

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