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Your firm currently has a debt to equity ratio of 0.2 and wishes to maintain this ratio over time as the company grows. Calculate the level of growth in sales that can be supported following a sustainable growth rate approach. Provide your answer in percent form, without the percent sign (X.YZ, not X. YZ% or 0.0XYZ). Net income forecast: $2,400,000 Book Equity: $30,000,000 % of Assets made up by Equity: 60% % of net income paid to shareholders: 9%

Your firm currently has a debt to equity ratio of 0.2 and wishes to maintain this ratio over time as the company grows. Calculate the level of growth in sales that can be supported following a sustainable growth rate approach. Provide your answer in percent form, without the percent sign (X.YZ, not X. YZ% or 0.0XYZ). Net income forecast: $2,400,000 Book Equity: $30,000,000 % of Assets made up by Equity: 60% % of net income paid to shareholders: 9%

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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Your firm currently has a debt to equity ratio of 0.2 and wishes to maintain this ratio over time as the company grows. Calculate the level of growth in sales that can be supported following a sustainable growth rate approach. Provide your answer in percent form, without the percent sign (X.YZ, not X. YZ% or 0.0XYZ). Net income forecast: $2,400,000 Book Equity: $30,000,000 % of Assets made up by Equity: 60% % of net income paid to shareholders: 9%
Transcribed Image Text:Your firm currently has a debt to equity ratio of 0.2 and wishes to maintain this ratio over time as the company grows. Calculate the level of growth in sales that can be supported following a sustainable growth rate approach. Provide your answer in percent form, without the percent sign (X.YZ, not X. YZ% or 0.0XYZ). Net income forecast: $2,400,000 Book Equity: $30,000,000 % of Assets made up by Equity: 60% % of net income paid to shareholders: 9%
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