The Hi-Lite Corp

question 19

Multiple Choice

The Hi-Lite Corp. had a profitable year and their ROE was 14.4%. The company paid out $1.20 of their earnings of $3.00 for the year. What is Hi-Lite's sustainable growth?

• A) 17.20%
• B) 8.64%
• C) 5.76%
• D) 43.20%

---

Definitions:

Merchandising Company

A type of business that purchases finished goods and sells them to consumers without changing their form.

Gross Margin

A company's total sales revenue minus its cost of goods sold, divided by the total sales revenue, expressed as a percentage. It represents the proportion of each dollar of revenue that the company retains as gross profit.

Local Retailer

A business that sells products directly to consumers in a specific geographical area.

Cost of Goods Sold

The costs directly associated with manufacturing the products a company sells, such as materials and labor expenses.