SWFT Corp Partner Estates Trusts
42nd Edition
ISBN: 9780357161548
Author: Raabe
Publisher: Cengage
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Transcribed Image Text:In response to complaints about high prices, a grocery
chain runs the following advertising campaign: "If you
pay your child $3 to go buy $100 worth of groceries,
then your child makes twice as much on the trip as we
do." You've collected the following information from
the grocery chain's financial statements:
(millions)
Sales
$700
Net income $10.5
Total assets $380
Total debt
$250
1. What is the profit margin for children as a
percentage of what they spend and the profit margin
for the store?
2. What is the store's ROE?
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