Management Can Increase Its Return on Investment By

question 8

Multiple Choice

Management can increase its return on investment by:

• A)Increasing its rate of profit on sales.
• B)Decreasing its expense while increasing its investments.
• C)Increasing its rate of capital (asset)turnover.
• D)Doing any of the above.
• E)Doing only two of the A-B-C above.

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Definitions:

Interest Rate

The interest rate is the amount charged, expressed as a percentage of principal, by a lender to a borrower for the use of assets.

Currency

The system of money in general use in a particular country, facilitating the buying and selling of goods and services.

Federal Funds Rate

The interest rate at which banks and other depository institutions lend money to each other, usually on an overnight basis, which is determined by the Federal Reserve in the United States.

Money Supply

The full ledger of economic financial resources at a specific instance.