Assume the Following Facts About a Firm The Firm's External Funding Requirement for Next Year Is
(Hint

question 143

Multiple Choice

Assume the following facts about a firm: $\begin{array}{lr}\text { Sales } _ {this year }&\$200,000\\\text { Net income }_ {this year }&\$30,000\\\text { Assets }_ {this year }&\$100,000\\\text { Current liabilities }_ {this year }&\$10,000\\\text { Anticipated growth rate }&10\%\\\text { Proposed dividend payout ratio }&40\%\end{array}$
The firm's external funding requirement for next year is
(Hint: You don't have to remember the EFR formula. Just realize that the funding requirement is the growth in assets less that in current liabilities less next year's retained earnings. A negative result means surplus funds are available.)

• A) $10,800
• B) ($28,800)
• C) ($10,800)
• D) $28,800

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Definitions:

Behavioral decision theory

A field of study that examines the psychological factors influencing individuals' decision-making processes.

Certainty, risk, and uncertainty

Certainty, risk, and uncertainty are terms used to describe the predictability of outcomes, where certainty is knowing the outcome, risk involves potential loss, and uncertainty indicates unknown future outcomes.

Problem-solving decisions

The process of identifying a problem and determining the most effective course of action to resolve it.

Conviction

A firmly held belief or opinion, demonstrating a strong sense of certainty about something.