Uses only common equity capital

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Reference no: EM13846771

Chang Corp. has $375,000 of assets, and it uses only common equity capital (zero debt). Its sales for the last year were $515,000, and its net income was $25,000. Stockholders recently voted in a new management team that has promised to lower costs and get the return on equity up to 15.0%. What profit margin would the firm need in order to achieve the 15% ROE, holding everything else constant?

10.92%

9.41%

11.82%

8.11%

12.66%

Reference no: EM13846771

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