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olya-2409 [2.1K]
3 years ago
9

General Electric (GE) has earnings per share of $2.98 and dividends per share of $0.35. Its return on assets (ROA) is 14.6% and

its return on equity (ROE) is 18.2%. What is its sustainable rate of growth?
Business
1 answer:
uysha [10]3 years ago
8 0

Answer:

g = 0.1606 or 16.06%

Explanation:

The sustainable growth rate is the growth rate in earning or dividends of a stock that will remain constant in the long run. Such a rate is calculate for an indefinite period of time. The formula to calculate the sustainable growth rate is,

g = RR * ROE

Where,

  • RR is the retention ratio or (1 - dividend payout ratio)
  • ROE is the return on equity

The dividend per share as a percentage of earnings per share will give us the dividend payout ratio.

Dividend payout ratio = 0.35 / 2.98 = 0.1174 or 11.74%

g = (1 - 11.74%) * 18.2%

g = 0.1606 or 16.06%

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Imagine that Odyssey National is a brand new bank, and that its required reserve ratio is 10 percent. Ifit accepts a $1,000 cash
lyudmila [28]

Answer:

a.$900

Explanation:

The required reserve is the amount of reserve required by the Central bank for banks to keep as reserves.

If the reserve ratio is 10% and $1000 is deposited, the required reserve is $100.

$1000 - $100 = $900 would be available to banks to give out as loans. Thus , money supply increases by $900.

I hope my answer helps you.

4 0
3 years ago
The Artisan Cheese Company in Florida has decided to add a new line of imported cheeses to its offering. The company president (
KonstantinChe [14]

Answer:

Cheeses from England.

Explanation:

First, let us define what Marketing Mix is:

  • This refers to the number of strategies a company employs to promote its goods and services in the market. The four Ps of the marketing mix include Product, Price, Place and Promotion.

The goal of a marketing strategy is to create awareness among the target audience.

Feedback and surveys are ways in which a company informs its marketing mix strategy. Therefore, if it has been determined from the customer feedback from company surveys and cheese tasting that the Product the customers prefer is Cheese from England, then that is what should be produced and promoted.

It cannot be over emphasized that companies are in business because of the customers, so their opinion takes precedence, as the saying goes, customer is always right. Therefore, if the need of the customer is not met, the company will make no profits.

The company president and product director will have to do what the customer wants.

4 0
3 years ago
A corporation in a 34% tax bracket invests in the preferred stock of another company and earns a 6% pretax rate of return. An in
miskamm [114]

Answer:

5.38% and 5.1%

Explanation:

In this question, we are asked to calculate the after tax return to the corporation and the after tax return to the investor.

What is meant by after tax return is simply the profit made after we subtract the amount of taxes. It is simply revenue less the amount of tax paid.

We calculate the values as follows:

For the corporation;

The after tax return can be calculated by the following mathematical expression;

After tax return to Corporation = 0.06 - (0.06 * 0.3) * 0.34 = 0.0538 = 5.38/100 which is same as 5.38%.

After tax return to the individual investor = 0.06(1-0.15) = 0.06 * 0.85 = 0.051 or just 5.1%

3 0
3 years ago
Read 2 more answers
A multinational enterprise (MNE) is defined as a firm that: exports more than it imports. sells in many markets around the globe
meriva

A multinational enterprise (MNE) is defined as a firm that operates and controls production or distribution facilities in more than one country.

<u>Explanation:</u>

According to Franklin Root MNE is a company that,

  • engages in foreign manufacturing or production via its other branches located in several other countries.
  • handles direct control over the policies of its own affiliates
  • implements various strategies in marketing, manufacturing, staffing and finance that transcend the national boundaries.

In some cases, the ownership of the MNEs are dispersed internationally and these corporations are known as transnational corporations (managed generally from global perspective).

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You’re so sweet for promoting ur mom’s channel and I’ve subscribed :>
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