Answer:
1. A firm's sustainable growth rate represents the:
highest growth rate without increasing financial leverage.
2. The sustainable growth rate of a firm with net income of $2.90 million, cash dividends of $1.90 million, and return on equity of 16% is:
= c. 5.52%
Explanation:
a) Data and Calculations:
Sustainable growth rate = Return on equity * Retention rate
Net income = $2.90 million
Cash dividends 1.90 million
Retained earnings = $1.0 million
Retention rate = $1.0/$2.90 * 100 = 34.48%
Return on equity = 16%
Therefore, the sustainable growth rate = 16% * 34.48%
= 5.5168%
= 5.52%
b) Sustainable growth rate is the rate of revenue growth, which an entity can attain without increasing its financial leverage (debts). The sustainable growth rate answers the question of how much a company can grow without additional equity or debt financing. It is a ratio that investment analysts and investors widely seek. There are four main ways of increasing an entity's sustainable growth rate, including sale of debt, issue of equity, increased profitability through efficient sales revenue, and reduced dividends payout to increase retained earnings.
Making sure they meet all aspect of the company's purpose.
Answer:
b.$39,200
Explanation:
Calculation to determine Paul's allowable itemized deductions for 2020
Using this formula
2020 itemized deductions=State income taxes+Real estate taxes+Gambling losses
Let plug in the formula
2020 itemized deductions=$13,500+$18,900+$6,800
2020 itemized deductions=$39,200
Therefore Paul's allowable itemized deductions for 2020 are $39,200
When an oil cartel effectively increases the price of oil by 100% causing a shock in oil consuming countries A and B.
The FED in country A takes immediate action increasing the money supply, while FED in inflationary country B does not take any action
In this case, in long term "Both countries return to their long-term stable equilibrium, but country A will remain with a higher price level than country B".
<h3>What is Federal Reserve System (FED)?</h3>
The nation's central banking system is the Federal Reserve System, usually referred to as the Federal Reserve or just the Fed.
The Fed offers a secure, adaptable, and stable monetary and financial system to the nation.
The Fed's primary responsibilities include-
- overseeing and regulating banks,
- implementing national monetary policy,
- preserving financial stability, and
- offering banking services.
Therefore, to better understand the effects of financial services laws and practices on customers and communities, the Federal Reserve promotes supervision, community reinvestment, and research.
To know more about monetary policy, here
brainly.com/question/13926715
#SPJ4
