Which of the Following Firms Would Be Expected to Have

question 30

Multiple Choice

Which of the following firms would be expected to have a high ROE based on that firm's high profitability?

• A)a medical supply company that provides very precise instruments at a high price to large medical establishments such as hospitals
• B)a low-end retailer that has a low mark-up on all items it sells
• C)a brokerage firm that has high levels of leverage
• D)a grocery store chain that has very high turnover,selling many multiples of their assets per year

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Definitions:

Pages

Typically refers to sheets of paper bound together within a book, or the digital equivalent in documents, used to display printed or written material.

Comparative Advantage

The ability of an individual, firm, or country to produce a certain good or service at a lower opportunity cost than competitors.

Absolute Advantage

The ability of an individual, firm, or country to produce more of a good or service than competitors using the same amount of resources.

Shoemaking

is the craft or industry involved in the design, production, and repair of shoes, including both traditional techniques and modern manufacturing.