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Boxity Corporation is a medical equipment manufacturing company. The company has a return on equity of 12% and a retention ratio of 40%. After introducing

Boxity Corporation is a medical equipment manufacturing company. The company has a return on equity of 12% and a retention ratio of 40%. After introducing a new production line, the company is expected to improve its return on the existing investments to 15% over the next 3 years, while the return on the new investments will remain as 12%. Estimate the total expected efficiency growth and the expected compounded average annual growth rate over the three years.

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