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Assume that XYZ Inc. has an 11.5% return on equity and retains 55% of its earnings for re-investment purposes. He recently paid a dividend of
Assume that XYZ Inc. has an 11.5% return on equity and retains 55% of its earnings for re-investment purposes. He recently paid a dividend of $ 3.25, and the stock is currently selling for $ 40. Determine.
a. The growth rate of XYZ. b. The required rate of return of the investor.
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