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Flattening Phillips Curve, “Passive” Policy, and Incidence of the Self-fulfilling Prophecy in a Standard New-Keynesian Model with Financial Accelerator Read chapter Read first chapter

2018 | OriginalPaper | Chapter

34. Sustainable Growth Rate: An Analysis Regarding the Most Traded Companies on the Bucharest Stock Exchange

Authors : Diana Elena Vasiu, Livia Ilie

Published in: Emerging Issues in the Global Economy

Publisher: Springer International Publishing

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Abstract

The concept of sustainable growth rate was originally developed by Robert C. Higgins. In the case of companies with given stable financial policies, it is considered to be the link between growth-return rate combinations that gives a balanced growth line. This indicates the possibilities for a company to grow without generating deficits or cash surpluses. Increased sales require more assets, which can be financed by new debt, external equity, and internal equity through retained earnings. The sustainable growth rate is the maximum rate at which company sales can increase without decreasing its financial resources. The aim of this paper is to determine if the last year most traded companies on the Bucharest Stock Exchange (BSE) have registered growth and if it was a sustainable one. Our research is based on two hypotheses: (1) the analyzed companies have a constant growth and the growth is sustainable and (2) the main factor that is influencing SGR is the retention rate. The results are only partially validating these hypotheses.

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Metadata
Title
Sustainable Growth Rate: An Analysis Regarding the Most Traded Companies on the Bucharest Stock Exchange
Authors
Diana Elena Vasiu
Livia Ilie
Copyright Year
2018
Book
Emerging Issues in the Global Economy

Print ISBN: 978-3-319-71875-0

Electronic ISBN: 978-3-319-71876-7

Copyright Year: 2018

DOI
https://doi.org/10.1007/978-3-319-71876-7_34

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