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You have the following information on Wilma and Fred Stone’s farming operation: Assets=$1,600,000 Liabilities= $600,000 Interest Rate on debt =9% Average Tax Rate=20% Consumption Rate =45% Equity Growth Rate=6.8% What is the rate of return on assets for the scenario presented here? What would the rate of return be if liabilities were $1,000,000? Explain any difference you observe.

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Category:- Financial Management
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