An analyst calculates the following ratios for a firm:

Sales/Total Assets: 2.8
Net Profit Margin (%): 4
Return on Total Assets (%): 11.2
Equity/ Total Assets: 0.625

The return on equity (in %) for this firm is closest to ______.

Explanation: ROE = Net Profit Margin x Sales/Total Assets x Total Assets/Equity = 4.0 x 2.8 x 1/0.625 = 17.9%

Alternatively, ROE = Return on Total Assets x Total Assets/Equity = 11.2 x 1/0.625 = 17.9%.