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Assume the following: 20x3 20X4 0.15 0.10 1.5 1.8 EBIT margin (EBIT/revenue) Asset turnover (revenue/assets) Leverage multiplier (assets/equity) Tax burden (net Income/EBT) Interest burden (EBT/EBIT)

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Assume the following: 20x3 20X4 0.15 0.10 1.5 1.8 EBIT margin (EBIT/revenue) Asset turnover (revenue/assets) Leverage multiplier (assets/equity) Tax burden (net Income/EBT) Interest burden (EBT/EBIT) 1.5 1.6 0.7 0.7 0.85 0.85 The company's return on equity: O decreased because the company's profit margin decreased increased because the company's asset turnover and leveraged increased remained constant because the company's decreased profit margin was just offset by increases in asset turnover and leverage

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