b

Start-Up Industries is a new firm that has raised $330 million by selling shares of stock. Management plans to earn a 20% rate of return on equity, which is more than the 15% rate of return avaliable on comparable-risk investments. Half of all earnings will be reinvested in the firm, a. What will be Start-Up's ratio of market value to book value? (Do not round Intermediate calculations.) Market-to-book ratio b. What will be Start-Up's ratio of market value to book value i the firm can earn only a rate of return of 10% on its investments? (Do not round intermediate calculations, Round your answer to 1 decimal place) Market to book ratio