$4.$ The board chair has asked management to develop some strategies to improve profitability and estimate the impact of the strategies on the hospital$$s return on equity $($ROE$).$ By how much would the $2021$ ROE change from each of these strategies? $($Hint: The case model cannot be used to answer these questions.$)$

a$.$ Vacant land is sold at a loss and total assets decrease by $$2\mathrm{.}0$ million. Net income would not be affected, and the board wants to maintain the $2021$ debt ratio.

b$.$ Debt is substituted for equity, and the debt ratio falls to $48$ percent. Total assets would not be affected. Interest expense would decrease, but inflation would offset the lower interest expense, and thus net income would not change.

c$.$ LEAN management is implemented, and total expenses decrease by $$0\mathrm{.}5$ million. Total revenue, total assets, and total liabilities and net assets would not change.

d$.$ Whatever strategy Melissa chooses, she is under pressure from the board to increase ROE to at least $14$ percent. What total margin would be needed to achieve the $14$ percent ROE, holding everything else constant?