Rapid Growth Industries has a 5.2 percent profit margin and a 20 percent dividend payout ratio. The total asset turnover is 2.0 and the debt-equity ratio is 0.75. What is the sustainable rate of growth?
Rapid Growth Industries has a 5.2 percent profit margin and a 20 percent dividend payout ratio. The total asset turnover is 2.0 and the debt-equity ratio is 0.75. What is the sustainable rate of growth?
Financial Management: Theory & Practice
16th Edition
ISBN:9781337909730
Author:Brigham
Publisher:Brigham
Chapter7: Corporate Valuation And Stock Valuation
Section: Chapter Questions
Problem 1P: Ogier Incorporated currently has $800 million in sales, which are projected to grow by 10% in Year 1...
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Transcribed Image Text:Rapid Growth Industries has a 5.2 percent profit
margin and a 20 percent dividend payout ratio. The
total asset turnover is 2.0 and the debt-equity ratio is
0.75. What is the sustainable rate of growth?
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