You Observe That a Firm's ROE Is Above the Industry

question 115

Multiple Choice

You observe that a firm's ROE is above the industry average,but both its profit margin and equity multiplier are below the industry average.Which of the following statements is CORRECT?

• A) Its total assets turnover must be above the industry average.
• B) Its return on assets must equal the industry average.
• C) Its TIE ratio must be below the industry average.
• D) Its total assets turnover must be below the industry average.
• E) Its total assets turnover must equal the industry average.

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Definitions:

Quantifier Negation

The process of applying negation to a quantified statement, potentially altering its meaning significantly.

Universal Generalization

A form of logical inference where a general statement is made about all members of a set based on sufficient evidence or instances.

Existential Instantiation

A logical operation that infers the existence of at least one individual satisfying a particular property from a general statement.

Universal Instantiation

A logical rule of inference that allows one to deduce a particular instance from a universal statement, essentially moving from a general statement to a specific example.