Firms U and L Each Have the Same Amount of Assets

question 2

Multiple Choice

Firms U and L each have the same amount of assets, and both have a basic earning power ratio of 20%. Firm U is unleveraged, i.e., it is 100% equity financed, while Firm L is financed with 50% debt and 50% equity. Firm L's debt has a before-tax cost of 8%. Both firms have positive net income. Which of the following statements is CORRECT?

• A) The two companies have the same times interest earned (TIE) ratio.
• B) Firm L has a lower ROA than Firm U.
• C) Firm L has a lower ROE than Firm U.
• D) Firm L has the higher times interest earned (TIE) ratio.
• E) Firm L has a higher EBIT than Firm U.

Identify the false statements about foster care and understand the complexities of out-of-home placements.

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Explain the impact of socioeconomic status (SES) on parenting practices and children’s development.

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Definitions:

Mixed Branding

a strategy where a company markets products under several different brands, often catering to different market segments.

Own Market

A term referring to the market where a company sells its products or services, often in contrast to competitor markets.

Reseller

An entity or person who buys products or services to sell them, rather than to use or consume them personally.

Multibranding

The marketing strategy that involves a company using two or more brands to market similar products or services to different segments.