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PurpleChapeau, Inc. is planning to increase its basic level of inventory (i.e., increase in inventory) and to pay for this increase with excess cash held

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PurpleChapeau, Inc. is planning to increase its basic level of inventory (i.e., increase in inventory) and to pay for this increase with excess cash held in its checking account (i.e., decrease cash). The company believes that this event will have no effect on either sales or costs, and therefore no effect on net income. All else constant, this new policy should cause the firm's return on assets (assuming an initial ROA of 12% ) to: 1) Decrease 2) Increase 3) No Change 4) Not enough information is provided to answer this

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