Question: 1 . ( a ) If the Layala Corporation has 1 3 per cent ROE and a 2 0 per cent payout ratio, what is

1.(a) If the Layala Corporation has 13 per cent ROE and a 20 per cent payout ratio, what is its sustainable growth rate?
(b) If the management decides to distribute the entire earnings to shareholders (pay-out ratio 100%), what is the sustainable growth rate?

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