Assume that the net profit margin = 9%, assets are 95 cents for every dollar of sales, and equity is 86 percent of assets. According to the DuPont system of financial ratio analysis, the ROE would beapproximatelyO A. 8%O B. 10%O c. 9%O D. 11%

ROE (DuPont Model) = Net Profit Margin x Asset Turnover x Equity Multiplier Where, Net Profit…

Answered: Assume that the net profit margin = 9%,…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter3: Evaluation Of Financial Performance

Section: Chapter Questions

Problem 13P

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Assume that the net profit margin = 9%, assets are 95 cents for every dollar of sales, and equity is 86 percent of assets. According to the DuPont system of financial ratio analysis, the ROE would be approximately O A. 8% O B. 10% Oc. 9% O D. 11%