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A firm increases its debt-equity ratio from 1.20 to 1.50. If its return on assets (ROA) remains at 7%, then the firm's debt ratio must
A firm increases its debt-equity ratio from 1.20 to 1.50. If its return on assets (ROA) remains at 7%, then the firm's
| debt ratio must increase by 30%. |
| return on equity (ROE) must decline by 0.3%. |
| return on equity (ROE) must increase by 2.1%. |
| profit margin must increase by 0.3%. |
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