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ROE = 14.3%
Payout Ratio = 42%
Sustainable Growth Rate = ROE * (1 - Payout Ratio)
Sustainable Growth Rate = 14.30% * (1 - 0.42)
Sustainable Growth Rate = 14.30% * 0.58
Sustainable Growth Rate = 8.29%
Solution
ROE = 14.3%
Payout Ratio = 42%
Sustainable Growth Rate = ROE * (1 - Payout Ratio)
Sustainable Growth Rate = 14.30% * (1 - 0.42)
Sustainable Growth Rate = 14.30% * 0.58
Sustainable Growth Rate = 8.29%

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ROE = 14.3 Payout Ratio = 42Sustainable Growth Rate = ROE (1.pdf

  • 1. ROE = 14.3% Payout Ratio = 42% Sustainable Growth Rate = ROE * (1 - Payout Ratio) Sustainable Growth Rate = 14.30% * (1 - 0.42) Sustainable Growth Rate = 14.30% * 0.58 Sustainable Growth Rate = 8.29% Solution ROE = 14.3% Payout Ratio = 42% Sustainable Growth Rate = ROE * (1 - Payout Ratio) Sustainable Growth Rate = 14.30% * (1 - 0.42) Sustainable Growth Rate = 14.30% * 0.58 Sustainable Growth Rate = 8.29%