Question
A firm has $20 million in equity and $10 million in debt. The firm forecasts that this year's net income will be $2.5 million. It
A firm has $20 million in equity and $10 million in debt. The firm forecasts that this year's net income will be $2.5 million. It currently pays dividends equal to 30% of its net income. If the firm decides to change its payout policy to 40% of net income, how would this change its internal growth rate?
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Financial Markets And Institutions A Modern Perspective
Authors: Anthony Saunders, Marcia Millon Cornett, Marcia Cornett
2nd Edition
007294109X, 978-0072941098
