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A firm has a retention ratio of 33 percent and a sustainable growth rate of 8.80 percent. The capital intensity ratio is 1.25 and the debt-equity ratio is .68. What is the profit margin?

A firm has a retention ratio of 33 percent and a sustainable growth rate of 8.80 percent. The capital intensity ratio is 1.25 and the debt-equity ratio is .68. What is the profit margin?

Intermediate Financial Management (MindTap Course List)
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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A firm has a retention ratio of 33 percent and a sustainable growth rate of 8.80 percent. The capital intensity ratio is 1.25 and the debt-equity ratio is .68. What is the profit margin?
Transcribed Image Text:A firm has a retention ratio of 33 percent and a sustainable growth rate of 8.80 percent. The capital intensity ratio is 1.25 and the debt-equity ratio is .68. What is the profit margin?
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