Profit Margin Is Defined As

question 223

Multiple Choice

Profit margin is defined as:

• A) Revenues divided by net sales.
• B) Net sales divided by assets.
• C) Net income divided by net sales.
• D) Net income divided by assets.
• E) Net sales divided by net income.

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Definitions:

Substitution Effect

The change in consumption patterns due to a change in price, leading consumers to substitute one product for another.

Real Balance Effect

An economic theory suggesting that inflation or deflation changes individuals' purchasing power, affecting their real income and consumption patterns.

Marginal Utility

The additional satisfaction or utility gained by consuming one more unit of a good or service.

Total Utility

The total satisfaction received from consuming a given total quantity of a good or service.