Parchment Company has $2,000,000 of assets, and it uses only common equity capital (zero debt). Its sales for the last year were $1,500,000, and its net income was $240,000. Stockholders recently voted in a new management team that has promised to lower costs and get the return on equity up to 15%. What profit margin would Parchment need in order to achieve the 15% ROE? Assume that the new actions will have no effect on total assets and sales, and it will not change the companys determination to use 100% equity to finance its operations.

a. 15.00%

b. 20.00%

c. 25.50%

d. 30.00%

e. 33.33%