A Firm Has Sales of $3,200,net Income of $390,total Assets

question 88

Multiple Choice

A firm has sales of $3,200,net income of $390,total assets of $4,500,and total equity of $2,750.Interest expense is $50.What is the common-size statement value of the interest expense?

• A)0.89 percent
• B)1.56 percent
• C)3.69 percent
• D)10.26 percent
• E)14.55 percent

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Definitions:

Consumer Surplus

The gap between the intended investment consumers are willing to make in a product or service and their actual financial outlay.

Willingness to Pay

The maximum amount an individual is ready to sacrifice to acquire a good or benefit from a service.

Market Demand Curve

A graphical representation showing the relationship between the price of a good and the total amount of the good that all consumers are willing to purchase at each price level.

Willingness to Pay

The utmost price a consumer is ready to pay for a good or service, indicating its perceived value to them.