Which of the Following Ratios Measures the Earnings of a Company

question 118

Multiple Choice

Which of the following ratios measures the earnings of a company on each dollar of assets invested?

• A)Return on assets
• B)Return on sales
• C)Return on equity
• D)Current ratio

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Definitions:

Herfindahl Index

A measure of market concentration that sums the squares of the market shares of all firms in the market, used to assess competition levels.

Federal Merger Guidelines

Regulations and criteria established by federal agencies to evaluate and approve or disapprove proposed mergers, ensuring fair competition.

Herfindahl Index

A measure of the size of firms in relation to the industry and an indicator of the amount of competition among them, calculated by squaring the market share of each firm within the industry and then summing the total.

Vertical Merger

A merger between two companies that operate at different stages of the production process for a specific product.