What is the internal growth rate the firm can achieve

Reference no: EM13261247

Assume the firm has a constant dividend payout ratio and a constant debt-equity ratio. What is the internal growth rate the firm can achieve without any external financing? Currently, the firms sales =$4,700, net income is $420, total assets=7890, dividends=125, A/P =790, LTD= 3130, and common stock=2780, and retained earnings =1190.

A. 3.61 percent
B. 3.88 percent
C. 5.98 percent
D.8.03 percent

Reference no: EM13261247

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