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Cambria, Inc., had equity of $145,000 at the beginning of the year. At the end of the year, the company had total assets of $275,000. During the year the company sold no new equity. Net income for the year was $26,000 and dividends were $5,500.

a) What is the sustainable growth rate for the company?

b) What is the sustainable growth rate if you use the formula ROE × b and beginning of period equity?

c) What is the sustainable growth rate if you use end of period equity in this formula?

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M941108

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