Last Year Blease Inc Had a Total Assets Turnover of 1.33

Multiple Choice

Last year Blease Inc had a total assets turnover of 1.33 and an equity multiplier of 1.75. Its sales were $295,000 and its net income was $10,600. The CFO believes that the company could have operated more efficiently, lowered its costs, and increased its net income by $10,250 without changing its sales, assets, or capital structure. Had it cut costs and increased its net income by this amount, how much would the ROE have changed?

A) 6.55%
B) 7.28%
C) 8.09%
D) 8.90%
E) 9.79%