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If a company's net profit margin is -5%, its total asset turnover is 1.5 times, and its financial leverage ratio is 1.2 times, its return on equity is closest to: A. -9.0%. B. -7.5%. C. -3.2%.

If a company's net profit margin is -5%, its total asset turnover is 1.5 times, and its financial leverage ratio is 1.2 times, its return on equity is closest to: A. -9.0%. B. -7.5%. C. -3.2%.

Intermediate Financial Management (MindTap Course List)
Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Eugene F. Brigham, Phillip R. Daves
Chapter7: Analysis Of Financial Statements
Section: Chapter Questions
Problem 6P
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Financial accounting

If a company's net profit margin is -5%, its total asset turnover is 1.5 times, and its financial leverage ratio is 1.2 times, its return on equity is closest to: A. -9.0%. B. -7.5%. C. -3.2%.
Transcribed Image Text:If a company's net profit margin is -5%, its total asset turnover is 1.5 times, and its financial leverage ratio is 1.2 times, its return on equity is closest to: A. -9.0%. B. -7.5%. C. -3.2%.
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