Return on Net Worth Equals Return on Assets Times _____

question 34

Multiple Choice

Return on net worth equals return on assets times _____.

• A)profit margin
• B)cost of goods sold
• C)asset turnover
• D)financial leverage

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Definitions:

Correlation

Correlation is a statistical measure that expresses the extent to which two variables change together. If the variables tend to increase and decrease in relation to each other, the correlation is positive; if one increases as the other decreases, it is negative.

Construct Validity

The degree to which a measurement device accurately measures the theoretical construct it is designed to measure.

Reliability

The consistency and stability of measurements or assessments over time.

Validity

The degree to which a tool, test, or measure accurately represents or measures what it claims to.