Chang Corp

question 20

Multiple Choice

Chang Corp.has $375,000 of assets,and it uses only common equity capital (zero debt) .Its sales for the last year were $595,000,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?

• A)9.45%
• B)9.93%
• C)10.42%
• D)10.94%
• E)11.49%

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Definitions:

Gentle Stroking

A soft and soothing touch or caress intended to provide comfort, reduce stress, or express affection.

Pain Spot

A specific area on the body that, when stimulated, produces a sensation of pain.

Cold Sensation

The perception of reduced temperature, often triggered by low environmental temperatures or specific nerve responses.

Wetness Sensation

The perception of moisture or liquid, which can involve complex interactions between touch, temperature, and pressure sensory systems.