Align Division Is One of the Divisions of DynaCore

question 127

Multiple Choice

Align Division is one of the divisions of DynaCore.Align's invested capital is $420,000.Last year, Align generated NOPAT of $64,260 on sales of $756,000.Which one of the following correctly calculates Align Division's return on investment using the two components of return on investment?

• A)$64,260 ÷ $756,000
• B)11.76% × 0.56
• C)$4,260 ÷ $756,000
• D)8.5% × 1.80

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Definitions:

Price-elastic

A characteristic of a good or service indicating a high sensitivity to changes in its price, where a small price change leads to a significant change in quantity demanded or supplied.

Price Elasticity

A measure of the sensitivity of quantity demanded or supplied to changes in price.

Substitutes

Pairs of goods for which a rise in the price of one of the goods leads to an increase in the demand for the other good.

Related Diversification

Is used when a corporation believes it can achieve synergy among the various businesses that it owns.