Which One of the Following Measures the Efficiency with Which

question 394

Multiple Choice

Which one of the following measures the efficiency with which a firm uses it resources to generate sales?

• A) Price-earnings ratio
• B) Return on equity
• C) Total asset turnover
• D) Current ratio
• E) Return on assets

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Definitions:

Relevant Range

The range of activity over which changes in cost are of interest to management.

Cost Behavior

Cost behavior refers to how different types of production costs change when there is a change in the level of production activity.

Relevant Range

The range of activity within which the assumptions about variable and fixed cost behavior hold true for a given business.

Management Decision-making

This involves the processes and strategies managers use to make choices that direct the organization towards its goals.