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Suppose book value of equity today ( TE 0 ) is $ 1 0 0 0 . The return on equity is 1 6 %

Suppose book value of equity today (TE0) is $1000. The return on equity is 16%(NI1/TE0). NI1 is net income over the next year. The retention ratio is 30%. What is the sustainable growth rate?
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4.8%
5%

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