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Plank s Plants had net income of $ 2 , 0 0 0 on sales of $ 5 0 , 0 0 0 last year.

Planks Plants had net income of $2,000 on sales of $50,000 last year. The firm paid a dividend of $500. Total assets were $100,000, of which $40,000 was financed by debt.
(a) What is the firms sustainable growth rate? Express your answer as a percentage.
(b) If the firm grows at its sustainable growth rate, how much debt will be issued next year?

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