Return on Assets Is a Better Measure of Profitability Than

question 81

True/False

Return on assets is a better measure of profitability than profit margin because it takes into account the assets invested in the business.

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Definitions:

Producer Surplus

The discrepancy between the price at which producers are prepared to sell a product and the actual price they obtain.

Consumer Surplus

A mismatch between the price consumers feel prepared to pay for a good or service, and the actual outlay.

Competitive Price

A price that is in line with or slightly below the market average, aiming to attract customers in a competitive environment.

Total Surplus

is the sum of consumer surplus and producer surplus, representing the overall economic benefit to society from trade or market activity.