Which Ratio Measures a Firm's Performance in Using Assets to Generate

question 157

Multiple Choice

Which ratio measures a firm's performance in using assets to generate earnings independent of how the firm financed acquisition of those assets?

• A)rate of return on assets
• B)rate of return on common stockholders' equity
• C)earnings per share of common stock
• D)rate of return on preferred stockholders' equity
• E)none of the above

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Definitions:

Theory Of Recovery

Legal principles that provide the basis on which a plaintiff can sue and obtain damages or other remedies in court.

Establishing Duty

The process of determining whether an individual or entity has a legal obligation or responsibility in a particular situation.

MacPherson v. Buick

A landmark court case that established the principle that manufacturers owe a duty of care to not only the purchasers of their products but also to the users.

Foreseeable Plaintiff

A concept in tort law referring to an individual who could be reasonably expected to be harmed by the defendant's actions or negligence.