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Pagemaster just reported earnings of $2 million. They are retaining 40% of those earnings ($800,000),...

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Accounting

Pagemaster just reported earnings of $2 million. They are retaining 40% of those earnings ($800,000), and paying out 60% as a dividend. The historical ROE for the firm is 16% per year and the company has 1,000,000 shares outstanding selling at $10 per share. What is the required return ("r") for Pagemaster?

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