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13. We have two firms with the following financial metrics (Challenging Question): FIRM A FIRM B 55% Total Debt / Total Assets 40% ROA 8%

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13. We have two firms with the following financial metrics (Challenging Question): FIRM A FIRM B 55% Total Debt / Total Assets 40% ROA 8% 11% Which firm has a greater ROE and by how much? (Hint: ROA Net Ircome / Total Assets and ROE = Net Income / Total Equity) O Firm A by less than 0.50% Firm A by more than 1.00% O Firm B by less than 0.50% O Firm B by more than 1.00% O Both firms have the same ROE O None of the above

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