JUNE 2013

1: Which of the following is one of the critical assumptions of Walters' Model?
A.
All financing is done through retained earnings; external sources of funds like debt or new equity capital are not used.
B.
The retention ratio, once decided upon, is constant. Thus, the growth rate, (g = br) is also constant.
C.
The capital markets are perfect and the investors behave rationally.
D.

All of the above

 

Answer : C

Explanation :

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Option: A

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