Accounting · Du Pont Analysis
In Du Pont Analysis, if a company increases its Return on Equity (ROE) without changing its Net Profit Margin or Asset Turnover, which component is primarily responsible for this change?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Operating Leverage
- 2Financial Leverage (Equity Multiplier)✓
- 3Net Profit Margin
- 4Asset Turnover
Correct answer
Financial Leverage (Equity Multiplier)
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