Compute the maximum growth rate

Assignment Help Finance Basics
Reference no: EM1362253

The Tapley Company is trying to determine an acceptable growth rate in sales. While the firm wants to expand, it does not want to use any external funds to support such expansion due to the particularly high interest rates in the market now. Having gathered the following data for the firm, what is the maximum growth rate it can sustain without requiring additional funds?

Capital intensity ratio = 1.2
Profit margin = 10%
Dividend payout ratio = 50%
Current sales = $100,000
Spontaneous liabilities = $10,000
a. 3.6%
b. 4.8%
c. 5.2%
d. 6.1%
e. 5.7%

 

Reference no: EM1362253

Questions Cloud

Illustrate what greens fees should the operator set : Illustrate what greens fees should the operator set on weekdays and how many rounds will be played.
Treatment of mental illness : What barriers prevent people with mental illnesses from receiving the care they need? Are the barriers different in the U.S. as compared to other countries?
Explain and conduct a job analysis task-based approach : Explain and Conduct a job analysis (Task-Based approach) on an entrance level management position
Draw the demand curve that must exist if consumers bear : Equilibrium in the market occurs at a price of $2,500 and a quantity of 10,000. Draw the demand curve that must exist if consumers bear the entire burden of a $500-per-TV tax imposed on this market
Compute the maximum growth rate : The Tapley Corporation is trying to determine an acceptable growth rate in sales. While the company wants to increase, it does not want to use any external funds to support such expansion due to the particularly high interest rates in market now.
Write algorithm find intersection of two singly-linked list : Write an algorithm (pseudocode) to find the intersection of two singly-linked lists. Assume that the data in each list are in nondecreasing order.
Explain contributing cause of the decline in investment : Which of the following was not a contributing cause of the decline in investment and thus the recessionary expenditure gap occurring during the U.S. recession of 2001.
Diagnosis of mental illness : Also discuss how a diagnosis of mental illness might negatively impact on the person rights as a citizen with reference to the concept of citizenship.
Social distribution of health and illness : what is the relationship between knowledge and power and how does this influence the social distribution of health and illness?

Reviews

Write a Review

 

Finance Basics Questions & Answers

  Computation of value of bond and intrinsic value

Computation of value of bond and intrinsic value and Holding everything constant and assuming that the coupon is paid on a semiannual basis

  Percentage change in the price of bonds laurel

Whereas the Hardy Corp. bond has 15 years to maturity. If interest rates suddenly fall by 2 percent, the percentage change in the price of Bonds Laurel, Inc

  Systemic and unsystemic events

Classify the following events as mostly systematic or mostly unsystematic and tell us why. Is the distinction clear in each case?

  What is goal for a business and write a well-organized essay

Determination of goal for a business and write a well-organized essay identifying the main premise of the book

  Profitable deployment of additional direct labor hours

Lamb Golf Accessories Limited produces a range of specialized waterproof golf shoes, in 4 different quality specifications. Deluxe 600, Palmer 20, Nicholas 360, Standard 640.

  Expected impact from the transation cost

You work for ABC in finance department and own shares that are selling at $20 per share on the NYSE. There is a new stock offering that is going to be publicly declared.

  Foreign exchange risks

What are the sorts of foreign exchange risk companies encounter when they deal internationally? It would be great if you could describe in detail with examples if possible.

  Risky portfolio and the risk-free asset

Suppose you have $500,000 available to invest. The risk-free rate is 8 percent, and there is a fund in which you could invest that has an expected return of 16 percent.

  Calculation of current market price of the share

Calculation of current market price of the share and  What is the intrinsic value of the warrant and What is the speculative premium on the warrant?

  Finance theory based questions

Determine the two major sources of spontaneous short-term financing for a firm and explain how do their balances behave relative to the firm's sales?

  Multiple choice finance problems

Assume that one-year treasury bills yield 4% in the United State and 5 percent in Germany. Investors will be indifferent between them if they expect the dollar over the next year to.

  A report on financial accounting

This report is specific for a core understanding for Financial Accounting and its relevant factors.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd