The Return on Assets Ratio

question 1

Multiple Choice

The return on assets ratio

• A)considers the investment made by all creditors and stockholders.
• B)is a measure of the liquidity of a company.
• C)is based on average stockholders' equity as compared to net income for the period.
• D)reflects investments made only by the creditors of a company.

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Definitions:

Call Option

A financial contract giving the buyer the right, but not the obligation, to purchase an asset at a specified price within a certain timeframe.

Strike Price

This is the fixed price at which the owner of an option can purchase (in the case of a call option) or sell (in the case of a put option) the underlying security or commodity.

Standard Deviation

A statistical measurement of the dispersion or variation in a set of values, indicating how much individual data points differ from the mean.

Call Option

A financial contract that gives the buyer the right, but not the obligation, to buy an asset at a specified price within a certain time period.