Q300
Return on assets = 6.7% and equity multiplier = 2.5% then return on equity will be
A.
16.75%
AnswerB.
2.68%
C.
0.37%
D.
9.20%
Answer: Option A
Solution
Answer: Option A
Solution:
Return on equity = Return on assets × Equity multiplier = 6.7% × 2.5% = 16.75%