A Firm Has a Profit Margin of 12%; Total Asset

question 99

Multiple Choice

A firm has a profit margin of 12%; total asset turnover of .55 and an equity multiplier of 2.2. What is the firm's ROA and ROE?

• A) ROA = 6.6%; ROE = 14.52%
• B) ROA = 7.2%; ROE = 15.84%
• C) ROA = 9.5%; ROE = 20.9%
• D) ROA = 8.1%; ROE = 17.82%

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Definitions:

Equilibrium Price

The price at which the quantity of a good or service supplied matches the quantity demanded, leading to a stable market condition.

Fine Imposed

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Illegally transported goods or persons across borders to avoid customs duties or immigration restrictions.