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What is the return on equity for a firm with a 12% return on assets, an 8% return on debt, and a 0.85 debt/equity ratio? a. 14.24% b. 15.40% c. 16.28% d. 18.20%

What is the return on equity for a firm with a 12% return on assets, an 8% return on debt, and a 0.85 debt/equity ratio? a. 14.24% b. 15.40% c. 16.28% d. 18.20%

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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What is the return on equity for a firm with a 12% return on assets, an 8% return on debt, and a 0.85 debt/equity ratio? a. 14.24% b. 15.40% c. 16.28% d. 18.20%
Transcribed Image Text:What is the return on equity for a firm with a 12% return on assets, an 8% return on debt, and a 0.85 debt/equity ratio? a. 14.24% b. 15.40% c. 16.28% d. 18.20%
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