A Firm Has $50 Million in Equity and $20 Million

question 93

Multiple Choice

A firm has $50 million in equity and $20 million of debt,it pays dividends of 30% of net income,and has a net income of $10 million.What is the firm's sustainable growth rate?

• A)12%
• B)13%
• C)14%
• D)15%
• E)16%

---

Definitions:

TAM

Total Addressable Market, which refers to the overall revenue opportunity available or total demand for a product or service within a market.

Major U.S. City

Any large and significant urban center in the United States typically characterized by a substantial population, economic activity, and cultural influence.

Reasonable Travel

Travel that is affordable and planned with budget constraints in mind, focusing on value for money.

TAM, SAM, SOM

Total Addressable Market (TAM) is the overall revenue opportunity available or market demand for a product or service; Serviceable Available Market (SAM) is the segment of TAM targeted and served by a company's products or services; Serviceable Obtainable Market (SOM) is the portion of SAM that a company can realistically capture.