When Comparing the Profitability of Firms in Different Industries,it Is

question 26

True/False

When comparing the profitability of firms in different industries,it is better to use profit margins on sales rather than profitability ratios based upon balance sheet items (such as return on equity or return on capital employed)?

---

Definitions:

Basic Assumption

An underlying principle or idea that is accepted as true without proof, forming the basis for further reasoning or behavior.

Level Of Investment

The amount of spending by businesses on capital goods, such as factories and machinery, which can influence economic growth.

Keynes

Refers to John Maynard Keynes, an economist famous for his ideas that in times of low demand, public sector investments are critical to economic stability and growth.

Macroeconomic Policies

Strategies and initiatives implemented by a government or monetary authority to control and improve the overall performance of the economy, including monetary, fiscal, and trade policies.