The internal rate of growth is based on the assumption that
A)no dividends are paid.
B)no external funding of any type is obtained.
C)the return on equity is held constant.
D)the only additional outside capital obtained is long-term debt.
E)the debt-equity ratio is held constant.

Question

Quizplus · Accepted Answer

The internal rate of growth assumes that no external funding is obtained, meaning the company relies solely on its retained earnings to finance growth.

The Internal Rate of Growth Is Based on the Assumption