A Total Asset Turnover Ratio of 3

question 83

Multiple Choice

A total asset turnover ratio of 3.5 indicates that:

• A) For every $1 in assets, the firm earned $3.50 in net income.
• B) For every $1 in assets, the firm produced $3.50 in net sales during the period.
• C) For every $1 in assets, the firm paid $3.50 in expenses during the period.
• D) For every $1 in assets, the firm earned gross profit of $3.50 during the period.
• E) For every $1 in sales, the firm acquired $3.50 in assets during the period.

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Definitions:

Monopoly

A market structure characterized by (1) a single seller of a well-defined product for which there are no good substitutes and (2) high barriers to the entry of any other firms into the market for that product.

Vigorous Competition

Vigorous competition refers to a market condition characterized by strong rivalry among firms, aiming to outperform one another in price, quality, and service.

Short Run

In economics, a period during which at least one input or factor of production is fixed, focusing on immediate outcomes.

Output Quantity

Refers to the total amount of goods or services produced by a company or within an economy during a specific time period.