A Firm with a Low Return on Total Assets Can

question 86

Multiple Choice

A firm with a low return on total assets can improve its return on equity, all else remaining the same, by ________.

• A) increasing its debt ratio
• B) increasing its total asset turnover
• C) decreasing its debt ratio
• D) decreasing its total asset turnover

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Definitions:

Coelom

A fluid-filled body cavity in many animals, located between the intestinal canal and body wall, lined by tissue derived from mesoderm.

Ectoderm

The outermost layer of cells or tissue of an embryo in early development, giving rise to the nervous system and skin.

Coelom

A fluid-filled body cavity found in most multicellular animals, located between the intestinal canal and the body wall, and surrounded by mesoderm tissue.

Endoderm

The innermost layer of cells or tissue of an embryo in early development, giving rise to the lining of the gut and the associated structures.