If Merton Corp

question 86

Multiple Choice

If Merton Corp. has a ROE of 23.4 percent, what is the plowback ratio needed to achieve a sustainable growth rate of 7 percent? (Round to nearest whole number.)

• A) 34%
• B) 30%
• C) 24%
• D) 28%

---

Definitions:

Franchise

A licensing arrangement whereby an individual or group is granted the right to operate a business under the established brand and business model of another entity.

Low-context Culture

A communication style characterized by explicit verbal messages, where most of the information is encoded in the words spoken.

Nonverbal Contextual Clues

Nonspoken signals or cues within a communication or environment that provide additional information or insights, influencing interpretation.

Cultural Diversity

The existence of a variety of cultural or ethnic groups within a society.