Which of the Following Statements Is CORRECT

question 11

Multiple Choice

Which of the following statements is CORRECT?

• A) An increase in a firm's debt ratio, with no changes in its sales or operating costs, could be expected to lower the profit margin.
• B) The ratio of long-term debt to total capital is more likely to experience seasonal fluctuations than is either the DSO or the inventory turnover ratio.
• C) If two firms have the same ROA, the firm with the most debt can be expected to have the lower ROE.
• D) An increase in the DSO, other things held constant, could be expected to increase the total assets turnover ratio.
• E) An increase in the DSO, other things held constant, could be expected to increase the ROE.

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Definitions:

Maladaptive Emotional Reactions

Emotional responses that are counterproductive to a person's current situation or well-being, interfering with normal functioning.

Phobias

Intense, irrational fears of specific objects or situations, leading to significant distress or impairment in social, occupational, or other important areas of functioning.

Behaviorism

A theory of learning based on the idea that all behaviors are acquired through conditioning.

Observable Behavior

Actions or reactions of an individual that can be seen and measured directly by others.