Answer:
9.6%
Explanation:
The ROE is 12 %
The payout ratio is 20%
The first step is to calculate tnr retention ratio
= 1-(20/100)
= 1-0.2
= 0.8
The sustainable growth can be calculated as follows
= 12×0.8
= 9.6
Hence the sustainable growth rate is 9.6%
