Calculate the median roe for the steel industry

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Reference no: EM132763529

Question - You are the head of the strategic management department of a company that manufactures steel. You are in the process of updating the company's strategic growth plan. The level of competition in the industry has increased significantly and you expect the trend to continue. Your company must take into account the effect of the increased competition on its performance. Aluminium, Copper, Iron, Lead, and Mercury are other companies in the steel industry. Use the following information from these companies to assist you in making a presentation to the board.

You have: Aluminium, Copper, Iron, Lead, Mercury. Each Has in sales $68,679, $20,252, $56,620, $34,616, $20,414. Each has an Ebit of $5,287, $1,914, $4,262, $2,321, $2,653. And each have a net income of $4,575, $1,381, $2,776, $1,411, $2,717.

Use the following metrics (as given in this unit's interactive infographic) to calculate the performance of the steel industry: 1. Economic income 2. Asset turnover 3. Leverage 4. Profit margin 5. Return on equity

Calculate the median ROE for the steel industry and assess the level of competition compared to the automotive industry, whose median is 9%. Refer to the Unit 3 notes for a refresher on the median calculation.

Reference no: EM132763529

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