The equity multiplier = debt to equity +1. Therefore, if the debt to equity ratio is 1.40, the equity multiplier is 2.40.

EQUITY MULTIPLIER=Total Assets / Total Stockholders' Equity

Given: ROA = 10%, Profit margin = 2%, ROE = 15%

ROA = Profit margin x Asset Turnover

Therefore,

Asset Turnover = ROA / Profit margin

= 10 / 2 = 5%

ROE = Profit margin x Asset Turnover x Equity multiplier

15 = 2 x 5 x Equity Multiplier

15 / 10 = Equity Multiplier

Equity Multiplier = 1.05

1.4

0.75