Problem 3.11 – Internal Growth Rate
Essentials of Corporate Finance
Ross, Westerfield, and Jordan
10th Edition and 11th Edition
Given an ROA and a payout ratio, what is the internal growth rate?
Given an ROA and a payout ratio, what is the internal growth rate?
Given ROE and a payout ratio, determine the sustainable growth rate.
Calculate the sustainable growth rate given the profit margin, capital intensity ratio, debt-equity ratio, net income, and dividends paid.
Given the total asset turnover, the profit margin, the equity multiplier, and the payout ratio, compute the sustainable growth rate.
Construct a common-size balance sheet for Bethesda Mining given a balance sheet. Note that you only need to input the blue inputs, the white cells will auto-populate because the balance sheet must balance.
Given a balance sheet with two years of data, you are asked to compute the following ratios:
Given a balance sheet, sales, and net income, you are asked to compute the profit margin, total asset turnover, equity multiplier, and ROE for the company.
Determine the total asset turnover and equity multiplier for the firm.
Given profit margin, sales, debt, and total assets determine the firm’s ROA.
What is the internal growth rate? What is the sustainable growth rate?