If the profit margin is 0.0891, asset turnover is 0.4732 and financial leverage is 1.1957, what is the return on equity?
A) 0.0504
B) 0.0421
C) 0.5658
D) 0.5623

Name: If the profit margin is 0.0891, asset turnover is 0.4732 and financial leverage is 1.1957, what is the return on equity? A) 0.0504 B) 0.0421 C) 0.5658 D) 0.5623
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Question

Quizplus · Accepted Answer

Return on equity (ROE) is calculated as the product of profit margin, asset turnover, and financial leverage. ROE = 0.0891 * 0.4732 * 1.1957 = 0.0504.

If the Profit Margin Is 0