A Firm Has $20 Million in Equity and $20 Million

question 64

Multiple Choice

A firm has $20 million in equity and $20 million of debt,it pays dividends of 20% of net income,and has a net income of $5 million.What is the firm's sustainable growth rate?

• A)18%
• B)19%
• C)20%
• D)21%
• E)22%

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Definitions:

Negative Reinforcement

The reinforcement of a response by the removal, escape from, or avoidance of an unpleasant stimulus.

Operant Conditioning

A method of learning that employs rewards and punishments for behavior, emphasizing the role of reinforcement in shaping behavior.

Undesirable Behaviors

Actions or patterns of behavior that are deemed negative or harmful in a social or personal context.

Distorted Thought

A cognitive process where reality is misrepresented or interpreted inaccurately, often found in psychological disorders such as depression or anxiety.