Question
Consider a retail firm with a net profit margin of 3.13%, a total asset turnover of 1.75, total assets of $44.4 million, and a book
Consider a retail firm with a net profit margin of 3.13%, a total asset turnover of 1.75, total assets of $44.4 million, and a book value of equity of $17.9 million.
a. What is the firm's current ROE?
b. If the firm increased its net profit margin to 3.68%, what would be its ROE?
c. If, in addition, the firm increased its revenues by 18% (maintaining this higher profit margin and without changing its assets or liabilities), what would be its ROE?
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Game Theory Basics
Authors: Bernhard Von Stengel
1st Edition
1108910114, 9781108910118
