Explain what Return on Assets (ROA) measures? Will two firms with the same EBIT have the same ROA?

Q: What’s the risk of competition on financial markets and institutions profitability?

A: Competitive risk or Risk of Competition is the force that will hinder the organization in achieving…

Q: How would you use financial statement analysis?         Is there one ratio that you feel is more…

A: Financial statements give ideas about performance of company within accounting period.We can compare…

Q: As a Businessman and Entrepreneur, which do you think is more important between Return On Asset…

A: ROA is the return on assets and ROI is the return on investment.

Q: The apex of the pyramid of ratios (return on total net assets) is an overall measure of probability…

A: The return on net asset (RONA) ratio, a measure of financial performance, is an alternative to the…

Q: Where are Financial costs and Dividends considered in a scenario analysis? Just a simple answer

A: Introduction :  A scenario analysis is a tool used to assess the potential outcomes of a given…

Q: Should we use (1) total sales, (2) EBITDA, (3) EBIT, or (4) net income to evaluate firm…

A: The choice of financial performance indicators to use depends on the specific goals and…

Q: Explain how current assets’ investment policies affect the firm’s risk and return trade-offs.

A: Current assets for a company are all those assets that are readily available for the conversion into…

Q: Based on the market value ratio, which ratio determine stability, earning power and capital? Explain…

A: The market value ratio is the ratio on the basis of market value and some specified performance…

Q: Which financial ratios would you recommend to evaluate a company's solvency? Once these ratios are…

A: To evaluate company solvency,  Solvency ratios are the company long-term ability to cover the…

Q: Is an investment pool is equivalent to a firm's treasury? How?

A: Introduction Investment is an important financial activity of an organisation. Every Organisations…

Q: Which of the following is Return on equity. O Economic value. O Market capitalization. O Firm…

A: There are many tools to measure the performance and compare with other firms and that will help in…

Q: ain why the required rate of return on a firm's assets must be equal to the weighted average cost of…

A: Weighted average cost of capital is the weighted cost of equity and weighted cost of debt after…

Q: Should firms focus on book value or market value capital structures? How would the calculatedWACC be…

A: In all actuality, the organization will have the option to utilize the capital structure dependent…

Q: Explain briefly what working capital and working capital management are and what they do. Explain…

A: The financial Ratios will be calculated by taking the numerical values that are taken from the…

Q: What is market efficiency? How do we characterise efficiency in financial markets? Briefly explain…

A: Market efficiency refers to the degree to which market prices reflect all available, relevant…

Q: How do investors reduce investment risk by asset allocation and diversification?

A: Investment risk is a risk of potential financial loss built into the investment. For example:…

Q: What is “benchmarking” and how is it used in financial ratio analysis? Provide an example.

A: Benchmarking is a process used in financial ratio analysis to compare a company's performance and…

Q: How do you think financial ratios differ across different industries

A: Financial ratios are a way a whole company can be analysed based on its profitability , liquidity or…

Q: which ratio is of greater interest to the owner-manager, the rate of return on total assets or the…

A: The ratio refers to the measure that determines the relation between two numbers. In accounting, the…

Q: The business risk of a company is most accurately measured by the company's: a. Debt-to-equity…

A: Bussiness risk consists uncertainty of sales and profits and other production related uncertainty.

Q: easier to calculate directly, the expected rate of return on the assets of a firm or the expected…

A: The return on assets states how profitable the assets of company are in generating the revenue. To…

Q: Which one of the following is an internal characteristic that can affect the value of an investmen…

A: Internal Characteristics mean factors within the organization. It excludes political events,…

Q: What is the arbitrage equation, and why is it useful in studying investment?

A: Arbitrage pricing theory or APT is defined as a multifactor pricing model which helps in predicting…

Q: what is the efficient market hypothesis. What does it say, if any, about individual financial…

A: Since you have asked multiple questions, we will solve the first question for you. Please ask…

Q: Question :- Can the financial health of a firm be based off of one ratio? Why or why not? How do you…

A:

Q: How does Net Proft Margin, ROA, and ROE determine a firm's financial profitability?

A: Financial profitability refers to that financial situation of a company in which its revenues are…

Q: The business risk of a company is most accurately measured by the company's: a. Debt-to-equity…

A: Various risk is associated with business, some of them are controllable by the company while some…

Q: What is one classification scheme that firms often use to obtain risk-adjusted costsof capital?

A: The question is based on the concept of risk-adjusted costs of capital with consideration of…

Q: Define the term Return on Common Equity? How does it measure profitability?

A:

Q: Profitability Ratios: Asset Efficiency Ratios: Liquidity Ratios: Solvency Ratios: Stockholder…

A: Financial ratios or accounting ratios  is a relative magnitude of two selected numerical values…

Q: Define financial statement analysis and how do users use liquidity and efficiency, solvency,…

A: Solution- When we perform financial statement analysis we focus on four building blocks of Financial…