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Troyanec [42]
3 years ago
12

The green giant has a 5% profit margin and a 40% dividend payout ratio. the total asset turnover is 1.40 and the equity multipli

er is 1.50. what is the sustainable rate of growth?
Business
1 answer:
Eduardwww [97]3 years ago
6 0
<span>Sustainable Growth Rate is = ( 1- Dividend Payout Ratio ) X RoE Now, We have to find out the RoE of the given problem. Return on Equity (RoE) = (Net Profit Margin) X (Asset Turnover) X(Equity Multiplier). = (0.05) X (1.40) X (1.50) =0.105 or 10.5% Now Sustainable Growth Rate(SGR) = (1- .40) X 0.105 = .063 or 6.3% So, According to the question SGR of Green Giant is = 6.3%</span>
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Answer:

This question is incomplete, the options are missing. The options are the following:

A) The old price times the change in quantity.

B) The old price times the new quantity.

C) The new price times the change in quantity.

D) The old quantity times the change in price.

And the correct answer is the option D: The old quantity times the change in price.  

Explanation:

To begin with, the name of <em>"Price Effect"</em> refers to a concept known in economics as the situation where a consumer is affected by the change in the price that a good he plans to buy staying everything else constant. This effect is quantifiable as the old quantity times the change in price when we see the representation in a graphic due to the fact that when the demand curve moves the new position will be established by that new price that have affected the consumer given the same old quantity.

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