3. Delta Medical Instruments, a largest medical equipment producer, has the following as of Dec. 31:...

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3. Delta Medical Instruments, a largest medical equipment producer, has the following as of Dec. 31": Stockholders' Equity Common stock-$0.80 par value: Authorised 35,000,000 shares, issued 15,000,000 shares Paid-in capital in excess of par Retained earnings Less: Cost of treasury stock (1,000,000 shares) Total stockholders' equity $63,000,000 $31,000,000 $4,000,000 ? On the debt side, Gamma has $48M and forecasts $24M in net income for the year. It currently pays dividends equal to 15% of its net income. You are analyzing a potential change in payout policy-an increase in dividends to 24% of net income. Determine: a) ROA; b) ROE; c) both old and new retention rate; and d) both old and new internal and sustainable growth rates. Explain what do the retention and growth rates tell you in this case? 3. Delta Medical Instruments, a largest medical equipment producer, has the following as of Dec. 31": Stockholders' Equity Common stock-$0.80 par value: Authorised 35,000,000 shares, issued 15,000,000 shares Paid-in capital in excess of par Retained earnings Less: Cost of treasury stock (1,000,000 shares) Total stockholders' equity $63,000,000 $31,000,000 $4,000,000 ? On the debt side, Gamma has $48M and forecasts $24M in net income for the year. It currently pays dividends equal to 15% of its net income. You are analyzing a potential change in payout policy-an increase in dividends to 24% of net income. Determine: a) ROA; b) ROE; c) both old and new retention rate; and d) both old and new internal and sustainable growth rates. Explain what do the retention and growth rates tell you in this case?