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Company A has sales of $2,000 , assets of $500 , and a debt ratio (debt/assets) of 40 percent, and an ROE of 10 percent.
Company A has sales of
$2,000
, assets of
$500
, and a debt ratio (debt/assets) of 40 percent, and an ROE of 10 percent. Company B has the same sales, assets, and net income, but its ROE is 15 percent. What is B's debt ratio? Hint: DuPont Analysis may be useful.
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