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NEW QUESTION: 1
Given that the expected growth rate for a firm is 5%, the expected total asset turnover is 0.87, the expected financial leverage multiplier is 0.81, the expected return on capital is 1.4, and expected retention rate is 60%, what is the expected net profit margin of the firm?
A. Not enough information
B. 9.3%
C. 14.8%
D. 11.8%
E. 6.9%
F. 12.3%
Answer: D
Explanation:
Explanation/Reference:
Explanation:
The growth rate of a firm is equal to the expected retention rate multiplied by the expected return on equity.
Rearranging this yields that the expected ROE is equal to the growth rate divided by the retention rate (ROE = 0.05/0.60 = 0.0833). The expected ROE is itself equal to the expected profit margin multiplied by the expected asset turnover multiplied by the expected financial leverage multiplier. Rearranging this yields that the expected net profit margin is equal to the ROE divided by the total asset turnover and the financial leverage multiplier (0.0833 / (0.87 x 0.81) = 0.118 = 11.8%
NEW QUESTION: 2
A. Option A
B. Option D
C. Option C
D. Option B
Answer: A
NEW QUESTION: 3
Consider the following diagram from an object studio action:
What is the problem with this flow?
A. There is a risk of the flow causing an infinite loop.
B. There should be a wait stage at the end of the flow, before the end stage to ensure the flow logic has worked correctly.
C. The Exception Block should be removed from the page so that all exceptions on that page can be recovered.
D. There is nothing wrong with the object flow shown in this image.
Answer: C
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