Variables a and B Are Inversely Related

question 12

Multiple Choice

Variables A and B are inversely related. If we plot A on the horizontal axis and B on the vertical axis, the line that connects combinations of A and B plotted in a two-variable diagram would be

• A)parallel to the horizontal axis.
• B)downward-sloping (left to right).
• C)parallel to the vertical axis.
• D)upward-sloping (left to right).

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Definitions:

Profit Margin

A financial ratio representing the percentage of revenue that remains as profit after all expenses have been deducted.

ROA

Return on Assets; a financial ratio indicating the profitability of a company relative to its total assets.

Total Assets

The combined value of all owned resources that have economic value and can provide future benefits to the business.

Return On Assets

A profitability ratio that measures how efficiently a company uses its assets to generate profit.