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What is the return on equity for a firm with a 15% return on assets, a 10% return on debt, and a 0.75 debt/equity ratio? a. 18.75% b. 20.00% c. 23.75% d. 26.25%

What is the return on equity for a firm with a 15% return on assets, a 10% return on debt, and a 0.75 debt/equity ratio? a. 18.75% b. 20.00% c. 23.75% d. 26.25%

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?

What is the return on equity for a firm with a 15% return on assets, a 10% return on debt, and a 0.75 debt/equity ratio? a. 18.75% b. 20.00% c. 23.75% d. 26.25%
Transcribed Image Text:What is the return on equity for a firm with a 15% return on assets, a 10% return on debt, and a 0.75 debt/equity ratio? a. 18.75% b. 20.00% c. 23.75% d. 26.25%
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