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Question
Selzer Inc. sells all of its merchandise on credit. It has a profit margin of 4 percent, days sales outstanding equal to 60 days, receivables of $150,000, total assets of $3 million, and a debt ratio of 0.64. The firm's return on equity (ROE) is:
a. 7.1%.
b. 33.3%.
c. 3.3%.
d. 71.0%.
e. 8.1%.
Answer
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