Montana Joe Corp. had net income of $12,500 last year, paid out $7,800 in dividends, and wants to maintain the same dividend payout ratio in the future.

At the beginning of last year, the company had a book value of debt of $38,000 and a book value of equity of $43,000.

1. What is the sustainable growth rate?
2. How much additional debt does the company have to take on if it grows at its sustainable growth rate in the coming year?