The following information pertains to Auburn Company. Assume that all balance sheet amounts represent both average and ending balance figures. Assume that all sales were on credit.

Assets
Cash and short-term investments	$42,526
Accounts receivable (net)	$31,173
Inventory	$26,105
Property, plant and equipment	$299,929
Total Assets	$399,733
Liabilities and Stockholders' Equity
Current liabilities	$67,659
Long-term liabilities	$95,631
Stockholders' equity-common	$236,443
Total Liabilities and stockholders' equity	$399,733
Income Statement
Sales	$82,274
Cost of goods sold	$37,023
Gross margin	$45,251
Operating expenses	$28,273
Net income	$ 16,978
Number of shares of common stock	5,979
Market price of common stock	$35

What is the rate earned on stockholders' equity for this company?

Select the correct answer.

12.5%

2.8%

1.4%

7.2%