Lloyd Inc. has sales of $500,000, a net income of $35,000, and the following balance sheet:

Cash	$	144,450		Accounts payable	$	141,750
Receivables		194,400		Notes payable to bank		102,600
Inventories		499,500		Total current liabilities	$	244,350
Total current assets	$	838,350		Long-term debt		189,000
Net fixed assets		511,650		Common equity		916,650
Total assets	$	1,350,000		Total liabilities and equity	$	1,350,000

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, without affecting sales or net income. If inventories are sold and not replaced (thus reducing the current ratio to 2), 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 -Select-increasedecreaseItem 1 by percentage points.

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