Lloyd Inc. has sales of $100,000, a net income of $5,000, and the following balance sheet:

Cash	$	17,430		Accounts payable	$	22,050
Receivables		37,590		Notes payable to bank		16,590
Inventories		102,900		Total current liabilities	$	38,640
Total current assets	$	157,920		Long-term debt		34,440
Net fixed assets		52,080		Common equity		136,920
Total assets	$	210,000		Total liabilities and equity	$	210,000

The new owner thinks that inventories are excessive and can be lowered to the point where the current ratio is equal to the industry average, 2.25, without affecting sales or net income. If inventories are sold and not replaced (thus reducing the current ratio to 2.25), if the funds generated are used to reduce common equity (stock can be repurchased at book value), and if no other changes occur, by how much will the ROE change? Do not round intermediate calculations. Round your answer to two decimal places.

ROE will (increase/decrease) by _____ percentage points.

What will be the firm's new quick ratio? Do not round intermediate calculations. Round your answer to two decimal places.

_____