Problem:
Net income is $2,262, Total Assets $39,150, Total Equity $21,650, and the retention ratio (beta) is 0.70.
Required:
Question: What is the internal growth rate?
A. 2.91%
B. 4.21%
C. 6.72%
D. 7.87%
E. 10.45%
Note: Be sure to show how you arrived at your answer.