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A Large Discount Store and Supermarket Has a Hair Styling

question 119

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A large discount store and supermarket has a hair styling salon on its premises. The salon has several operators. Salon customers can shop in other parts of the store until their name is called for salon service, at which time the customer will be served by the next available stylist. This scenario provides an example of which of the following?


Definitions:

Financial Risk

The chance of incurring financial losses from an investment or business activity.

Operating Leverage

A measure that shows how revenue growth translates into growth in operating income, highlighting the impact of fixed costs.

Financial Performance

An assessment of how well a company can use assets from its primary mode of business and generate revenues.

ROE

Return on Equity; a financial ratio indicating the profitability of a company in relation to its equity capital.

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