Which of the Following Statements Is CORRECT

question 80

Multiple Choice

Which of the following statements is CORRECT?

• A) In general,if investors regard a company as relatively risky and/or having relatively poor growth prospects,then it will have relatively high P/E and M/B ratios.
• B) The basic earning power ratio (BEP)reflects the earning power of a firm's assets after giving consideration to financial leverage and tax effects.
• C) The "apparent," but not necessarily the "true," financial position of a company whose sales are seasonal can change dramatically during a given year,depending on the time of year when the financial statements are constructed.
• D) The market/book (M/B)ratio tells us how much investors are willing to pay for a dollar of accounting book value.In general,investors regard companies with higher M/B ratios as more risky and/or less likely to enjoy higher future growth.
• E) It is appropriate to use the fixed assets turnover ratio to appraise firms' effectiveness in managing their fixed assets if and only if all the firms being compared have the same proportion of fixed assets to total assets.

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Definitions:

Traditional Chinese Values

The core principles and moral standards that have historically guided the behavior and societal practices in Chinese culture.

Organization's Culture

An assembly of mutual norms, values, and beliefs directing the behavior, emotions, and thoughts of workers in a business.

Organization's Discipline

The regulations, procedures, and norms established by an organization to regulate employee behavior and maintain order.

Job Design

The process of organizing tasks, duties, and responsibilities into a productive work unit within an organization.