Which of the Following Firms Would Be Expected to Have

question 62

Multiple Choice

Which of the following firms would be expected to have a high ROE?

• A) a medical supply company that provides very precise instruments at a high price to large medical establishments such as hospitals
• B) a high-end fashion retailer that has a very high 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 its assets per year

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Definitions:

Contract Negotiations

The process of discussing terms and reaching an agreement in a contract, often involving matters such as price, delivery, and terms of service between two or more parties.

Low-involvement

Products or services that require minimal thought and effort from consumers before purchase due to their simplicity and low cost.

High-involvement

Refers to purchase decisions that carry a higher risk to buyers and therefore require more thought and research.

Reference Groups

Groups that people refer to when evaluating their own qualities, circumstances, attitudes, values, and behaviors.