Which of the Following Statements Is Most Correct

question 72

Multiple Choice

Which of the following statements is most correct?

• A) An increase in a firm's debt ratio, with no changes in its sales and operating costs, could be expected to lower its profit margin on sales.
• B) An increase in the DSO, other things held constant, would generally lead to an increase in the total asset turnover ratio.
• C) An increase in the DSO, other things held constant, would generally lead to an increase in the ROE.
• D) In a competitive economy, where all firms earn similar returns on equity, one would expect to find lower profit margins for airlines, which require a lot of fixed assets relative to sales, than for fresh fish markets.
• E) It is more important to adjust the Debt/Assets ratio than the inventory turnover ratio to account for seasonal fluctuations.

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Definitions:

Anxiety Disorder

A category of mental health disorders characterized by significant and persistent worry and fear that interfere with daily activities.

Cognitive Therapies

A type of psychotherapy that focuses on changing unhelpful or negative thought patterns to improve emotional regulation and cope with mental health issues.

Favorable Results

Outcomes or findings that are advantageous, beneficial, or desired in a particular context or experiment.

Treatment

A method or course of action used to improve a condition or alleviate an ailment or disease.