If a firm wants to maintain its present ratio of debt to equity, its present dividend payout ratio, and does not want to sell any new equity, the firm's growth rate in sales and assets must be less than or equal to its:

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The sustainable growth rate is the maximum rate at which a firm can grow its sales, earnings, and dividends without increasing its debt-to-equity ratio, assuming it maintains its current dividend payout ratio and does not issue new equity. This concept captures the firm's ability to grow using internally generated funds and maintaining its financial policies.

If a Firm Wants to Maintain Its Present Ratio of Debt