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(--> c 0I? ezto.rnheduca Apps For quick access, place your hm.tpx here on the 6 for 9) 6. value 2.77 points Appliances has a retum-on-assets (investment) ratio of 13 percent a. Ir the debt to total-assets ratio is 25 percent, what is the return on equity? (Input your answer as a percent rounded to 2 decimal places.) 0751% b. Ir the firm had no debt, what would the return-on-equity ratio be? Unput your answer as a percent rounded to 2 decimal places.) n on 0 13% Hints References eBook & Resources O Type here to search

Solution

1)\'

Return on equity = Return on assets / 1 - D/E

Return on equity = 0.13 / 1 - 0.25

Return on equity = 0.13 / 0.75

Return on equity = 17.33%

2)

Tha same as return on assets of 13%