The Balance Sheets at the End of Each of the First

question 82

Multiple Choice

The balance sheets at the end of each of the first two years of operations indicate the following:

-If net income is $130,000 and interest expense is $40,000 for 2011,what is the rate earned on common stockholders' equity for 2011 (rounded to one decimal place) ?

• A)12.3%
• B)14.0%
• C)13.0%
• D)17.4%

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Definitions:

Parameter

A value that summarizes a characteristic of a population or a statistical model.

Confidence Interval

A range of values, derived from sample statistics, that is likely to contain the value of an unknown population parameter, expressed with a certain level of confidence.

Confidence Level

A confidence level is a statistical parameter that expresses how certain one is in the results of a statistical experiment, often represented as a percentage that quantifies the probability that the true parameter lies within the confidence interval.

Population Standard Deviation

The population standard deviation is a measure of the dispersion or variation of all members in a full set or 'population' of data.