Net Income Divided by Sales Is the Correct Formula for Calculating

question 66

Multiple Choice

Net income divided by sales is the correct formula for calculating:

• A) return on total assets.
• B) a current ratio.
• C) a liquidity ratio.
• D) profit margin on sales.
• E) a corporate evaluation.

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Definitions:

Utility Function

A mathematical representation of how different combinations of goods or services produce varying levels of satisfaction or utility to a consumer.

Commodities

Fundamental commodities traded in business that can be exchanged with others of alike kind.

Units Of Good

Measurement quantities used to quantify the amount, number, or level of goods.

Utility Function

A mathematical representation that assigns a value to every possible bundle of goods or services, with the value indicating the level of satisfaction or happiness that the consumer derives from that bundle.