A firm has total assets of $1,000,000 and a debt ratio of 30%. Currently, it has sales of $2,500,000, total fixed costs of $1,000,000, and EBIT of $50,000. If the firm's before-tax cost of debt is 10% and the firm's tax rate is 40%, what is the firm's ROE?

Answer rating: 100% (QA)

Return on Equity ROE is calculated using the following formula Net Income Total Equity ... View the full answer