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Last year Central Chemicals had sales of $ 2 7 5 , 0 0 0 , assets of $ 1 2 7 , 5 0

Last year Central Chemicals had sales of $ 275,000, assets of $ 127,500, a profit margin of 53%, and an equity multiplier of 1.2. The CFO believes that the company could reduce its assets by $ 21,000 without affecting either sales or costs. Had it reduced its assets in this amount, and had the debt-to-assets ratio, sales, and costs remained constant, by how much would the ROE have changed? Select the correct answer. a.1.47% b.2.70% c.2.29% d.1.88% e.1.06%

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