Ask Question
28 August, 02:51

A firm has a tax burden of 0.9, a leverage ratio of 1.1, an interest burden of 0.6, and a return-on-sales ratio of 13%. The firm generates $2.62 in sales per dollar of assets.

What is the firm's ROE?

+2
Answers (1)
  1. 28 August, 04:49
    0
    the firm's ROE is 20%

    Explanation:

    The tax burden is 0.9

    The interest burden is 0.6

    The return on sales margin is 13%

    The turnover ratio is 2.62

    The leverage ratio is 1.1

    Calculate the ROE

    ROE = 0.9 * 0.6 * 0.13 * 2.62 * 1.1

    =0.2 or 20%
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “A firm has a tax burden of 0.9, a leverage ratio of 1.1, an interest burden of 0.6, and a return-on-sales ratio of 13%. The firm generates ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers