A Dollar Amount Equal to the Operating Income of a Division

question 109

Multiple Choice

A dollar amount equal to the operating income of a division less a charge for the level of investment in the division is called:

• A) Operating profit after tax.
• B) Return on investment (ROI).
• C) Earnings from continuing operations.
• D) Return on equity (ROE).
• E) Residual income (RI).

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Definitions:

Interaction Term

In regression analysis, it's a variable created from the product of two or more variables to assess how the simultaneous influence of those variables on the outcome differs from the sum of their individual effects.

Dependent Variable

The variable in an experiment that is expected to change as a result of changes made to the independent variable.

First-Order Polynomial Model

A mathematical model of a linear relationship between the independent variable and the dependent variable, characterized by having no exponents higher than one.

Predictor Variable

A variable used in statistical models to predict or influence the outcomes of a dependent variable.