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Question Four (4 Marks) Internal Growth. In an Internal Growth situation, a firm with an asset turnover ratio of 2.0 has a plowback ratio of

Question Four (4 Marks) Internal Growth.

In an Internal Growth situation, a firm with an asset turnover ratio of 2.0 has a plowback ratio of 50 percent, and its an all-equity financed undertaking. What must its profit margin be if it wishes to finance 12 percent growth using only internally generated funds?

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