Primary Colors has a debt-equity ratio of .48, a return on assets of 13.6 percent, and a dividend payout ratio of 30 percent. What is the firm\'s rate of growth? Solution ROE= Return on asset = (1+ D/E ratio) = 13.60% x (1+0.48) = 20.13% Growth rate g = ROE x (1- payout ratio) = 20.13% x (1- 0.30) = 14.09%.