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Please andwer 6 & 7 Please use the following data for Questions 6 & 7 A company has an ROA of 6% and an equity
Please andwer 6 & 7
Please use the following data for Questions 6 & 7 A company has an ROA of 6% and an equity multiplier (Total Assets / Equity) of 20. Net Income for last year was $5.0 Million, of which $2.0 Million was paid out as dividends. Using the above data and the formulas: Intermal Growth Rate = (ROA x Plowback)/(1-(ROA x Plowback)) Sustainable Growth Rate = (ROE x Plowback)/(1-(ROE x Plowback)) please answer the following two questions 6. What is the internal Growth Rate? 3.73% 04.12% 05.5596 6,00% ONone of the above are correct solutions 7. What is the Sustainable Growth Rate? 04.929 055995 67.76 032496 None of the above are correct solutionsStep by Step Solution
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