If a Firm Produces a Twelve Percent Return on Assets

question 35

Multiple Choice

If a firm produces a twelve percent return on assets and also a twelve percent return on equity,then the firm:

• A)may have short-term, but not long-term debt.
• B)is using its assets as efficiently as possible.
• C)has no net working capital.
• D)has a debt-equity ratio of 1.0.
• E)has an equity multiplier of 1.0.

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Definitions:

Allergic

Having an adverse reaction of the immune system to a substance that is harmless to most people.

Insomnia

A sleep disorder characterized by difficulty falling asleep, staying asleep, or experiencing restful sleep.

Experiencing Insomnia

The condition of regularly having difficulty falling asleep or staying asleep, leading to poor sleep quality or quantity.

Rested

The state of having restored energy or fatigue relief after a period of rest or sleep.