The board of directors is dissatisfied with last year''s ROE of 15%. If the operating profit margin and asset turnover ratio remain unchaneed at 8% and 1.25, respectively, by how much must the leverage ratio (i.e., assets/equity) increase to achieve 20% ROE?

The answer is 33.33%.

Could you please be kind enough and show what a formula is applied and how it is calculated in detail? Thank you!