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May 29, 2015

Homework Help: Finance

Posted by Jackie on Sunday, June 27, 2010 at 9:32pm.

Burger Corp has $500,000 of assets and it uses only common equity capital (zero debt). Its sales for the last year were $600,000 and its net income after taxes was $25,000. Stockholders recently voted in a new management team that has promised to lower costs and get the ROE up to 15%. What profit margin would Burger need in order to achieve the 15% ROE, holding everthing else constant?

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