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A Toronto Firm Wants to Maintain a Growth Rate of 8

Question 112

Multiple Choice

A Toronto firm wants to maintain a growth rate of 8% without incurring any additional equity financing. The firm maintains a constant debt-equity ratio of.5, a total asset turnover ratio of.83, and a profit margin of 8 percent. What must the retention ratio be?


A) 71.8 %
B) 72.7 %
C) 74.4%
D) 75.1 %
E) 76.3%

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