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the relationship between investment and the growth of capital is?
a. very strong
b. very weak
c. always the same
d. none of the above
1 Answer
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- Mathew CLv 51 decade agoFavorite Answer
growth g= rb+(r-ki)(1-tc)bxB/S where r is roi, b is retention rate, ki cost of debt, tc is corporate tax rate, B/S is the capital sturcture. This shows that when r grows the growth also will grow.
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