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ROE change with asset reduction

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Last year:
Sales = $200,000
Assets = $125,000
Profit Margin = 5.15%
Equity Multiplier = 1.85

Assets will be reduced by $25,000 without affecting sales or costs. How much would the ROE change with this asset reduction?

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ROE Change
Last year:
Sales = $200,000
Assets = $125,000
Profit Margin = 5.15%
Equity Multiplier = 1.85

Assets will be ...

Purchase this Solution


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