R. N. C., Inc. desires a sustainable growth rate of 4.5 percent while maintaining a 40 percent dividend payout ratio and a 6 percent profit margin. The company has a capital intensity ratio of 1.23. What equity multiplier is required to achieve the company's desired rate of growth?
A. 1.33
B. 1.38
C. 1.42
D. 1.47
E. 1.53
Ans: D. 1.47
Business
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