Gambona inc. has sales of $200, net income of $20, total assets of $500, and common equity of $250, all in millions. the new cfo thinks the firm's current asset investment policy is too relaxed, and she proposes to tighten it, reducing inventories and receivables enough to bring total assets down to $300. the total liabilities/assets ratio will be kept at 50%, so common equity will decline from $250 to $150. assume that this change has no effect on either sales or net income. using the dupont equation, by how much would gambona's roe increase

Required: 1-a. the marketing manager argues that a $5,000 increase in the monthly advertising budget would increase monthly sales by $9,000. calculate the increase or decrease in net operating income. 1-b. should the advertising budget be increased ? yes no hintsreferencesebook & resources hint #1 check my work 8.value: 1.00 pointsrequired information 2-a. refer to the original data. management is considering using higher-quality components that would increase the variable expense by $2 per unit. the marketing manager believes that the higher-quality product would increase sales by 10% per month. calculate the change in total contribution margin. 2-b. should the higher-quality components be used? yes no