Which of the Following Is True

question 119

Multiple Choice

Which of the following is true?

• A)ROI is the primary basis for evaluating profit and investment centre managers.
• B)Increasing the average operating assets can increase ROI.
• C)Increasing either controllable margin or the average operating assets can raise ROI.
• D)When ROI is calculated, management would prefer a high percentage.

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Definitions:

Pareto Optimum

An economic state where resources are allocated in a manner that precludes the possibility of bettering one's situation without causing harm to another.

Desert Island

An uninhabited or deserted island, often depicted in literature and movies as a remote, isolated place.

Competitive Equilibrium

A market state where supply equals demand, and no economic agents have the incentive to change their behavior.

Utility Function

A mathematical representation of how a consumer ranks different bundles of goods according to the level of satisfaction or happiness they provide.