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    Question

    The DuPont model decomposes ROE

    into:
    A Equity + Debt + Profitability Correct Answer Incorrect Answer
    B Asset Turnover × Profit Margin × Leverage Correct Answer Incorrect Answer
    C Operating Profit + Net Income + ROA Correct Answer Incorrect Answer
    D NPV + IRR + DCF Correct Answer Incorrect Answer
    E None of the above Correct Answer Incorrect Answer

    Solution

    DuPont breaks ROE into three components: Net Profit Margin × Asset Turnover × Equity Multiplier.

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