A company has $1,000,000 of debt and $3,000,000 of assets. The company's cost of debt is 4%

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A company has $1,000,000 of debt and $3,000,000 of assets. The company's cost of debt is 4% and EBIT is $200,000. Assume there are no taxes.

What is the company's ROE?

Related Book For answer-question

Contemporary Financial Management

ISBN: 978-1285198842

13th edition

Authors: R. Charles Moyer, James R. McGuigan, Ramesh P. Rao

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Posted Date: May 08, 2023 05:22 AM

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A company has $1,000,000 of debt and $3,000,000 of assets. The company's cost of debt is 4%

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Expert Answer:

To calculate the companys ROE we need to first calculate the companys net inco... View the full answer

Contemporary Financial Management

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