Quiz Ch 18 – Drawback of Using Dividends as the Plug Item
Fundamentals of Corporate Finance
Brealey, Myers, and Marcus
10th Edition
What is a potential disadvantage of using dividends as the plug item in financial planning?
What is a potential disadvantage of using dividends as the plug item in financial planning?
What action would assist a firm in increasing its internal growth rate?
How can a firm raise its sustainable growth rate, and what are the possible strategies, involving changes to the payout ratio or return on equity, or both?
How does the flexibility of financial plans become apparent?
Which one will, all else being equal, decrease the internal growth rate?
Which one is NOT accurate regarding financial planning models?
What happened to the $500 difference when book equity rises by $2,000 without issuing new equity, and the firm’s net income is $2,500?
What is the characterization of a financial plan when a majority of its elements are associated with sales levels?
What typically occurs when a firm lacks spare capacity?
What change will result in a reduction of a firm’s internal growth rate?