Question

A firm wishes to maintain a growth rate of 8 percent and a dividend payout ratio of 62 percent. The ratio of total assets to sales is constant at 1, and the profit margin is 10 percent. What must the debt-equity ratio be if the firm wishes to keep these ratios constant?

A) .05

B) .40

C) .55

D) .60

E) .95

Answer

This answer is hidden. It contains 159 characters.