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What is the company expected growth rate

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Reference no: EM133062966

Question - Kahn Inc. has a target capital structure of 60% common equity and 40% debt to fund its $12 billion in operating assets. Furthermore, Kahn Inc. has a WACC of 13%, a before-tax cost of debt of 8%, and a tax rate of 25%. The company's retained earnings are adequate to provide the common equity portion of its capital budget. Its expected dividend next year (D1) is $2, and the current stock price is $26.

What is the company's expected growth rate? If the firm's net income is expected to be $1.2 billion, what portion of its net income is the firm expected to pay out as dividends? Do not round intermediate calculations. Round your answer to two decimal places.

Reference no: EM133062966

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