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QUESTION
This year Company P achieved an ROE of 14. Suppose management takes measures that decrease Asset turnover (Sales/Total Assets) next year.
This year Company P achieved an ROE of 14.8%. Suppose management takes measures that decrease Asset turnover (Sales/Total Assets) next year. Assuming Sales, Profits, and financial leverage remain the same, what effect would you expect this action to have on Andrews's ROE?
Select: 1
Company P ROE will decrease
Company P ROE will remain the same
Company P ROE will increase
