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Company A currently plows back 4 0 % of its earnings and earns a return of 2 0 % on this investment. The dividend yield

Company A currently plows back 40% of its earnings and earns a return of 20% on this investment. The dividend yield on the stock is 4%. Assuming that Company A can continue to plow back this proportion of earnings and earn a 20% return on the investment, how rapidly will earnings and dividends grow? What is the expected return on Company A stock?

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