456 Inc has a profit margin of 12%. It has a capital intensity ratio of 0.80 and its debt/equity ratio is 2. The company's net income was $100,000 and company paid a dividend of $70,000. What is the sustainable growth rate? A) 15.61% B) 18.64% C) 12.00% D) 21.95% E) 13.50%

456 Inc has a profit margin of 12%. It has a capital intensity ratio of 0.80 and its debt/equity ratio is 2. The company's net income was $100,000 and company paid a dividend of $70,000. What is the sustainable growth rate? A) 15.61% B) 18.64% C) 12.00% D) 21.95% E) 13.50%

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter7: Analysis Of Financial Statements

Section: Chapter Questions

Problem 6P

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Question

456 Inc has a profit margin of 12%. It has a capital intensity ratio of 0.80 and its
debt/equity ratio is 2. The company's net income was $100,000 and company paid a
dividend of $70,000. What is the sustainable growth rate?
A) 15.61%
B) 18.64%
C) 12.00%
D) 21.95%
E) 13.50%

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