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1 . Smith Corporation has the following ratios: A * / S , = 1 . 2 , L * / S , = 0

1. Smith Corporation has the following ratios: A*/S,=1.2, L*/S,=0.4 and a Profit Margin of 0.10 and a Dividend Payout Ratio of 45%. Last year's Sales were $150,000 million.Assuming that these ratios remain constant. Use the Self Supporting Growth formula to determine the firm's self-supporting growth rate.
2. Smith Corporation has the following ratios: A*/S,=1.6, L*/S,=0.4 and a Profit Margin of 0.10 and a Dividend Payout Ratio of 45%. Last year's Sales were $100,000 million.Assuming that these ratios remain constant. Use the AFN formula to determine the firm's self-supporting growth rate.

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