Biosite, Inc. is a developer, manufacturer, and marketer of medical diagnostic products in San Diego, California. If you wanted to test for parasites, drug abuse, or congestive heart failure, you would be wise to contact Biosite. Following are selected financial data for the company for the period 2000-2004. 2000 2001 2002 2003 2004 Profit margin (%) 11.2 10.3 12.7 14.3 16.9 Retention ratio (%) 100.0 100.0 100.0 100.0 100.0 Asset turnover (X) 0.66 0.64 0.80 0.89 0.86 Assets (end of year, millions) $83.0 $102.7 $131.3 $194.6 $283.5 Equity (end of year, millions) $72.9 $ 90.9 $107.9 $152.9 $220.3 Growth rate in sales (%) 25.8 19.4 60.3 64.8 41.3

a. Calculate Biosite's sustainable growth rate in each year.

b. Comparing the company's sustainable growth rate with its actual growth rate in sales, what growth problems did Biosite face over this period?

c. How did the company cope with these problems?AppendixLO1