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Intro NiteLate Inc. had revenue of $164,000 last year, costs of $98,400 and depreciation of $24,600. The company paid 7.1% interest on its debt, and
Intro NiteLate Inc. had revenue of $164,000 last year, costs of $98,400 and depreciation of $24,600. The company paid 7.1% interest on its debt, and its average tax rate is 0.25. NiteLate paid out $16,400 in dividends, and wants to maintain the same dividend payout ratio in the future. At the beginning of the year, the company had a book value of debt of $33,000 and a book value of equity of $50,000. Over the course of the year, no debt or equity was newly issued or retired. Part 3 | Attempt 4/10 for 10 pts. How much does the company have to newly borrow to keep a constant debt/equity ratio (in $)? 0+ decimals Submit Part 4 | Attempt 5/10 for 8 pts. What rate of growth is sustainable without any additional borrowing (internal growth rate)? 4+ decimals Submit
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