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Assume the following ratios are constant: Total asset turnover = 3.31 Profit margin = 6.9% Equity multiplier = 2.75 Payout ratio 38% a. What is the ROE? b. What is the sustainable growth rate? (Round your calculation to 2 decimal places)

Assume the following ratios are constant: Total asset turnover = 3.31 Profit margin = 6.9% Equity multiplier = 2.75 Payout ratio 38% a. What is the ROE? b. What is the sustainable growth rate? (Round your calculation to 2 decimal places)

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Assume the following ratioes are constant

Assume the following ratios are constant: Total asset turnover = 3.31 Profit margin = 6.9% Equity multiplier = 2.75 Payout ratio 38% a. What is the ROE? b. What is the sustainable growth rate? (Round your calculation to 2 decimal places)
Transcribed Image Text:Assume the following ratios are constant: Total asset turnover = 3.31 Profit margin = 6.9% Equity multiplier = 2.75 Payout ratio 38% a. What is the ROE? b. What is the sustainable growth rate? (Round your calculation to 2 decimal places)
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