Sales and Average Operating Assets for Company P and Company

question 177

Multiple Choice

Sales and average operating assets for Company P and Company Q are given below:
What is the margin that each company (Company P and Company Q,respectively) will have to earn in order to generate a return on investment of 20%?

• A) 2.5% and 5%.
• B) 8% and 4%.
• C) 12% and 16%.
• D) 50% and 100%.

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Definitions:

Frequency

The rate at which a particular action or event occurs over a defined period.

Anecdotal

Pertains to personal accounts or observations that are usually informal or unofficial in nature.

Duration

The length of time that something continues or exists.

Placebo Effect

A phenomenon in which a person experiences a perceived improvement in their condition due to their expectations or beliefs, rather than the effect of an active medical treatment.