A company has a return on equity of 14.60 percent and a profit margin of 10...

A company has a return on equity of 14.60 percent and a profit margin of 10 percent. What is the return on assets if the equity multiplier is 1.4?

Expert Solution

Return on equity = ROA * Equity multiplier

0.1460 = ROA * 1.4

ROA = 0.1460 / 1.4

ROA = 0.1043 or 10.43%

jeff jeffy answered 2 years ago

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