Axle Inc. reported $400 in total assets, $200 in equity, $50 in net income, $10 in dividends, and $40 in earnings retained in the period for the prior year. The sustainable growth rate of Axle Inc. is 20%.
Growth rates are the percentage changes in a given variable over a certain period of time. Growth rates are often calculated as the compounded yearly rate of growth of a company's revenues, earnings, dividends, or even macro terms like gross domestic product (GDP) and retail sales for investors. Both both forward-looking and trailing growth rates are frequently utilized in analysis. Growth rates are used to calculate the annual percentage change in a variable. When biologists initially started examining population sizes, growth rates were utilized.
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