Question: Break down the return on equity (ROE) of the two firms below using a DuPont analysis. Which of the following statements is correct? a) The

Break down the return on equity (ROE) of the two firms

Break down the return on equity (ROE) of the two firms below using a DuPont analysis. Which of the following statements is correct? a) The ROE of Firm Z is enhanced by greater use of debt. b) The ROE of Firm Z is enhanced by lesser use of debt. c) The ROE of Firm Z is reduced by greater use of debt d) The ROE of Firm Z is unaffected by its mix of debt and equity

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