Question
A firm has a tax burden ratio of 0.8, a leverage ratio of 2, an interest burden of 0.6, and a return on sales of
A firm has a tax burden ratio of 0.8, a leverage ratio of 2, an interest burden of 0.6, and a return on sales of 8%. The firm generates $3 in sales per dollar of assets.
-What is the firm's ROE?
- What is the firm's compound leverage factor?
- Does the company increase its ROE by using loans? How one can see that?
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Mergers, Acquisitions and Other Restructuring Activities
Authors: Donald DePamphilis
8th edition
9780128024539, 128013907, 978-0128013908
