Assume the following ratios are constant. Total asset turnover Profit margin Equity multiplier Payout ratio = 2.19 = 4.7% = 1.66 = 44% What is the sustainable growth rate? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Sustainable growth rate %

Principles of Accounting Volume 2
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ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter11: Capital Budgeting Decisions
Section: Chapter Questions
Problem 14MC: This calculation determines profitability or growth potential of an investment, expressed as a...
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Assume the following ratios are constant.
Total asset turnover = 2.19
Profit margin
= 4.7%
= 1.66
Equity multiplier
Payout ratio
= 44%
What is the sustainable growth rate? (Do not round intermediate calculations and enter
your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
Sustainable growth rate
%
Transcribed Image Text:Assume the following ratios are constant. Total asset turnover = 2.19 Profit margin = 4.7% = 1.66 Equity multiplier Payout ratio = 44% What is the sustainable growth rate? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Sustainable growth rate %
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