The Lighting Store has sales of $364,000, depreciation of $28,000, and taxable income of $58,000. The capital intensity ratio is 1.2, the debt-equity ratio is 0.45, and the tax rate is 34 percent. What is the return on assets?

1. 6.53 %

2. 7.21 %

3. 7.79 %

4. 8.76 %