Below Are the Net Operating Asset Turnovers and Net Operating

question 39

Multiple Choice

Below are the net operating asset turnovers and net operating profit margins for companies that operate in three different industries (A, B and C) . The industries are grocery stores, oil extraction and drug industry.
$$\begin{array} { l r r } & \text { NOPAT margin } & \text { Net operating asset turnover } \\\text { Industry A } & 8.0 \% & 1.5 \\\text { Industry B } & 1.2 \% & 5.5 \\\text { Industry C } & 5.4 \% & 1.0\end{array}$$
Match the industry to A, B or C

$\begin{array}{lll}&\text { Grocery Retail } & \text { Oil and Gas } & \text { Drug } \\A.&\text { B } & \text { C } & \text { A } \\B.&\text { B } & \text { A } & \text { C } \\C.&\text { C } & \text { A } & \text { B } \\D.&\text { C } & \text { B } & \text { A }\end{array}$

• A)Option A
• B)Option B
• C)Option C
• D)Option D

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Definitions:

Mental Accounting

The cognitive process individuals use to organize, evaluate, and keep track of their financial activities and decisions.

Irrational Decisions

Decisions made that do not follow logical reasoning or expected outcomes.

Opportunity Cost

The missed opportunity for profit from different options when a specific choice is made.

Resources

Assets, materials, and inputs used to produce goods and services, including land, labor, capital, and entrepreneurship.