Parodies Corp

Multiple Choice

Parodies Corp. has a return on assets of 10.9 percent, a return on equity of 16.7 percent, and a retention ratio of 40 percent. What is its sustainable growth rate?

A) 8.68 percent
B) 9.25 percent
C) 7.49 percent
D) 7.16 percent
E) 8.87 percent