Which of These Ratios Are the Determinants of a Firm's

question 32

Multiple Choice

Which of these ratios are the determinants of a firm's sustainable growth rate?
I.Assets-to-equity ratio
II.Profit margin
III.Retention ratio
IV.Asset turnover ratio

• A) I and III only
• B) II and III only
• C) II,III,and IV only
• D) I,II,and III only
• E) I,II,III,and IV

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Definitions:

Shareholder

An individual or entity that owns shares in a company, giving them a claim on part of its assets and earnings.

Pre-emptive Rights

Rights that allow existing shareholders to purchase additional shares in a company before new shares are offered to the public, to maintain their proportional ownership.

Shareholder's Agreement

A contract among the shareholders of a company outlining their rights, responsibilities, and obligations.

Voting Rights

The entitlement of individuals to participate in the election of government officials and to have their vote counted.