Compute the Profit Margin (Rounded to Nearest Percent)for the Tim

question 101

Multiple Choice

Compute the profit margin (rounded to nearest percent) for the Tim Tom investment center as shown below. $\begin{array}{lr} & \text { Tim Tom Subsidiary } \\\text { Total sales } & \$ 1,600 \\\text { Operating income } & \$ 140 \\\text { Average assets invested } & \$ 900 \\\text { Profit margin } & ? \\\text { Asset turnover } & ? \\\text { ROI } & ?\end{array}$

• A) 7%
• B) 9%
• C) 12%
• D) 18%

---

Definitions:

Prefabricated Garages

Buildings for storing vehicles that are manufactured off-site in advance, usually in standard sections that can be easily shipped and assembled.

Marginal Revenue

The additional revenue that a firm receives from selling one more unit of a good or service.

Price Discrimination

A pricing strategy where identical or substantially similar goods or services are sold at different prices by the same provider in different markets or to different buyers.

Economic Profits

The difference between total revenues and total costs, including both explicit and implicit costs, indicating the financial gain realized when accounting for opportunity costs.