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This year Baldwin achieved an ROE of 1.3%. Suppose next year the profit margin (Net Income/Sales) increases. Assuming sales, assets and financial leverage remain the same next year, what effect would you expect this action to have on Baldwin's ROE? Select : 1 Baldwin ROE will remain the same. Baldwin ROE will increase. Baldwin ROE will decrease.

This year Baldwin achieved an ROE of 1.3%. Suppose next year the profit margin (Net Income/Sales) increases. Assuming sales, assets and financial leverage remain the same next year, what effect would you expect this action to have on Baldwin's ROE? Select : 1 Baldwin ROE will remain the same. Baldwin ROE will increase. Baldwin ROE will decrease.

Understanding Business
Understanding Business
12th Edition
ISBN:9781259929434
Author:William Nickels
Publisher:William Nickels
Chapter1: Taking Risks And Making Profits Within The Dynamic Business Environment
Section: Chapter Questions
Problem 1CE
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This year Baldwin achieved an ROE of 1.3%. Suppose next year the profit margin (Net Income/Sales) increases. Assuming sales, assets and financial leverage remain the same next year, what effect would you expect this action to have on Baldwin's ROE?

Select : 1

  • Baldwin ROE will remain the same.
  • Baldwin ROE will increase.
  • Baldwin ROE will decrease.
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