Donovan Brothers,Inc

question 42

Multiple Choice

Donovan Brothers,Inc.would like to increase its internal rate of growth.Decreasing which one of the following will help the firm achieve its goal?

• A)return on assets
• B)net income
• C)retention ratio
• D)dividend payout ratio
• E)return on equity

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Definitions:

Recessionary Economy

An economic condition characterized by a significant decline in general economic activity across multiple sectors for an extended period.

Probability

An indicator of the probability that a particular event will happen, represented by a numerical value ranging from 0 to 1, with 0 denoting an impossibility and 1 denoting absolute certainty.

Market Risk Premium

The excess return that investors require for choosing to purchase stocks over "risk-free" securities, reflecting the additional risk of equity investments.

Expected Rate Of Return

The expected percentage of gain or loss an investment is projected to generate over a given period of time.