Which of the Following Statements Is True

question 40

Multiple Choice

Which of the following statements is true?

• A)The return on assets ratio indicates whether the company can pay its current debt when it becomes due.
• B)The causes for an increase or decrease in the return on assets ratio can be examined by calculating its two components: return on sales and asset turnover.
• C)If a company successfully applies leverage,its return on assets ratio will be greater than its return on common stockholders' equity ratio.
• D)If a company's return on assets ratio increases,the increase can be the result of decreased liquidity.

---

Definitions:

Oedipus Complex

A Freudian theory proposing that a child feels a subconscious sexual attraction to the opposite-sex parent and hostility toward the same-sex parent.

Defense Mechanisms

Psychological strategies employed unconsciously to protect oneself from anxiety arising from unacceptable thoughts or feelings.

Repression

A defense mechanism where stressful thoughts or memories are unconsciously pushed out of conscious awareness.

Freud's Concept

Theoretical ideas proposed by Sigmund Freud, focusing on the unconscious mind, the importance of childhood, and the structure of personality into ego, id, and superego.