Which of the Following Statements Is Correct

question 15

Multiple Choice

Which of the following statements is correct?

• A)If Company A has a higher debt ratio that Company B, then we can be sure that A will have a lower times- interest-earned ratio than B.
• B)Suppose two companies have identical operations in terms of sales, cost of goods sold, interest rate on debt, and assets.However, Company A used more debt than Company B; that is, Company A has a higher debt ratio.Under these conditions, we would expect B's profit margin to be higher than A's.
• C)The ROE of any company which is earning positive profits and which has a positive net worth (or common equity) must exceed the company's ROA.
• D)Statements a, b, and c are all true.
• E)Statements a, b, and c are all false.

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Definitions:

Participative Leadership

A leadership style where leaders involve team members in the decision-making process, enhancing engagement and commitment.

Satisfaction

The feeling of contentment or pleasure derived from meeting one's desires, expectations, or needs.

Decision Procedures

The methodologies, rules, or steps used to select a course of action among several alternatives.

Guideline

A set of recommended practices, instructions, or principles aimed at guiding actions or achieving desired outcomes.