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What is the internal growth rate

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Reference no: EM132669299

Question - A company has an ROA of 6% and an equity multiplier of 2.0. Net Income for last year was $10.0 Million, of which $4.0 Million was paid out as dividends.

1. What is the Internal Growth Rate?

a. 4.12%

b. None of the above are correct solutions

c. 5.55%

d. 3.73%

e. 6.00%

2. What is the Sustainable Growth Rate?

a. None of the above are correct solutions.

b. 5.58%

c. 7.76%

d. 4.92%

e. 8.24%

Reference no: EM132669299

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