Question: A positively signed AFN value represents: A point at which the funds generated within the firm equal the demands for funds to finance the firm's

A positively signed AFN value represents:

A point at which the funds generated within the firm equal the demands for funds to finance the firm's future expected sales

requirements.

A surplus of internally generated funds that can be invested in physical or financial assets or paid out as additional dividends.

A shortage of internally generated funds that must be raised outside the company to finance the company's forecasted future growth.

Because of its excess funds, Green Caterpillar Garden Supplies Inc. is thinking about raising its dividend payout ratio to satisfy shareholders. Green

Caterpillar could pay out

of its earnings to shareholders without needing to raise any external capital.

(

Hint: What can Green Caterpillar

increase its dividend payout ratio to before the AFN becomes positive?

)

A positively signed AFN value represents: A point at which the

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