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Joshua's Antiques has a TAT of 1.2, and EM of 1.4, a PM of 5%, a retention ratio of 0.8, and TA of $120,000. What is the sustainable growth rate?

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Final answer:

The sustainable growth rate cannot be calculated with the given information.

Step-by-step explanation:

The sustainable growth rate can be calculated using the formula:

Sustainable Growth Rate = (Retention Ratio) x (Return on Equity)

In this case, the retention ratio is 0.8 (or 80%) and the return on equity can be calculated using the formula:

Return on Equity = (Net Income / Total Equity)

The sustainable growth rate cannot be calculated with the given information.

The given information does not include the net income or total equity, so we are unable to calculate the sustainable growth rate using the provided data.

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