So given your knowledge of the component ratios used in the DuPont equation, which of the following strategies should improve the company’s ROE? Check all that apply.(A) Increase the firm’s bottom-line profitability for the same volume of sales, which will increase the company’s net profit margin.(B) Decrease the amount of debt financing used by the company, which will decrease the total asset turnover ratio.(C) Decrease the company’s use of debt capital because it will decrease the equity multiplier.(D) Increase the efficiency of its assets so that it generates more sales with each dollar of asset investment and increases the company’s total asset turnover.

(D) Increase the efficiency of its assets so that it generates more sales with each dollar of asset investment and increases the company’s total asset turnover.

Explanation:

Return on Equity is measured as the total return available for equity, or total value for equity.

Each increase in net profit will increase the return on equity, as that is the share for equity only.

Similarly when there is increase in efficiency of the assets to generate more sales and accordingly more revenue with the same amount of investment, this will increase the return on equity.

Return on Equity is basically measured through three parameters:

Operating efficiency which is basically the operating profit generated.
Asset usage, that means the total assets used for the output.
Financial leverage which is calculated through value of equity and assets, there is no significance of debt in it.

Therefore, the valid statements in this context are:

Statement (a) and (d)

marvineetesh3 marvineetesh3 · Answer 2 · 2022-02-12T06:11:16+01:00

The following Strategies should improve the company's ROE.

(A). Increase the firm’s bottom-line profitability for the same volume of sales, which will increase the company’s net profit margin, and

(D). Increase the efficiency of its assets so that it generates more sales with each dollar of asset investment and increases the company’s total asset turnover.

What is ROE?

ROE refers to the Return on Investment, It is a ratio between net income and investment. An advanced ROI means the gains of investments that compare favorably to its cost.

As a show measure, ROI is used to evaluate the investment efficiency or to compare the efficiencies of several different investments. It increases the profitability of the firm's bottom line and net profit margin, and also increases the asset's efficiency and turnover.

Therefore, options A and D are correct.

Learn more about Return on Investment, refer:

https://brainly.com/question/7920964