Major Manuscripts, Inc. 2012 Income Statement
Net sales	$	8,100
Cost of goods sold		6,915
Depreciation		240
Earnings before interest and taxes	$	945
Interest paid		40
Taxable Income	$	905
Taxes		308
Net income	$	597
Dividends	$	232

Major Manuscripts, Inc. 2012 Balance Sheet
	2012				2012
Cash	$	2,190		Accounts payable	$	1,390
Accounts rec.		880		Long-term debt		310
Inventory		2,900		Common stock	$	3,100
Total	$	5,970		Retained earnings		4,600
Net fixed assets		3,430
Total assets	$	9,400		Total liabilities & equity	$	9,400

Major Manuscripts, Inc., does not want to incur any additional external financing. The dividend payout ratio is constant. What is the firm's maximum rate of growth?

	3.74 percent
	4.13 percent
	4.04 percent
	11.91 percent
	6.12 percent