Problem 4.21 – Sustainable Growth and Outside Financing
Fundamentals of Corporate Finance
Ross, Westerfield, and Jordan
13th Edition
What is the sustainable growth rate for Caccamisse, Inc., and if it does grow at this rate, how much new borrowing will take place in the coming year, assuming a constant debt-equity ratio? What growth rate could be supported with no outside financing at all? Find the growth rate that could be supported with no outside financing.
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