Using the Following Information, the Return on Investment Is A) 10%
B) 12%
C) 14%
D) 16

question 46

Multiple Choice

Using the following information, the return on investment is:
$$\begin{array} { l r } \text { Sales } & \$ 80000 \\\text { Operating profit } & \$ 10000 \\\text { Profit margin } & 10 \% \\\text { Equity } & \$ 40000 \\\text { Minimum required rate of return } & 12 \% \\\text { Turnover of assets } & 1.4 \text { times p.a. }\end{array}$$

• A) 10%
• B) 12%
• C) 14%
• D) 16.8%

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Definitions:

Lock-up Clutch

A mechanism in automatic transmissions that locks the engine directly to the transmission at cruising speed to improve fuel efficiency and performance.

Coupling Ratio

in engineering, refers to the relationship between the input and output of a system, such as in transformers or gear ratios.

Fluid Couplings

A hydrodynamic device used to transmit rotating mechanical power; it has been used in automobile transmissions as a replacement for a mechanical clutch.

Torque Converter

A fluid coupling device that is used to transfer rotating power from a prime mover, like an engine, to a rotating driven load.