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Pacific Packaging's ROE last year was only 4 % , but its management has developed a new operating plan that calls for a debt -
Pacific Packaging's ROE last year was only but its management has developed a new operating plan that calls for a debttocapital ratio of which will result in annual interest charges of $ The firm has no plans to use preferred stock and total assets equal total invested capital. Management projects an EBIT of $ on sales of $ and it expects to have a total assets turnover ratio of Under these conditions, the tax rate will be If the changes are made, what will be the company's return on equity? Do not round intermediate calculations. Round your answer to two decimal places.
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