The Return on Assets Effect (ROA)quantifies and Measures

question 5

Multiple Choice

The return on assets effect (ROA) quantifies and measures:

• A)the indirect contribution of supply management to profitability.
• B)any increase in sales that occurs at a greater rate than the cost of assets.
• C)reduction in the allocations to the operating budget of the supply department.
• D)the impact of supply actions on inventory and the balance sheet.
• E)the effect on profitability of reduced spend compared to a sales increase.

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Definitions:

Diminishing Marginal Utility

The decrease in satisfaction or utility that a person derives from consuming each additional unit of a good or service.

Demand Curves

A graphical representation that shows the relationship between the price of a product and the quantity of the product that consumers are willing and able to purchase at various prices.

Marginal Utility

The extra value or satisfaction garnered by a consumer with the acquisition of one more unit of a good or service.

Total Utility

The overall satisfaction or happiness received from consuming a certain amount of goods or services.