Vandelay Industries Inc. has a target capital structure of 65% debt and 35% common equity and is looking to fund $5 billion in capital projects for the next year. Vandelay Industries has a target WACC of 12%, bonds that sell at par with a coupon rate of 9.5% and a tax rate of 25%. The company hopes their retained earnings will be adequate to fund the equity portion of Vandelay's capital budget. Vandelay expects to pay a year-end dividend of $3.20 and their common stock currently sells for $20. 1. What is Vandelay's growth rate? 2. Vandelay expects net income for the year to be approximately $520 million and they anticipate paying out 40% of those earnings in dividends. What is Vandelay's breakpoint in retained earnings