Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
Related questions
Question
Explains the effect of debt on profit margin and
Expert Solution
Step 1
Profit margin is net income as a percentage of sales and Return on assets is Net income as a percentage of total assets. Higher the net income, higher would be the profit margin and return on assets.On the other hand, lower the net income, lower would be the profit margin and return on assets.
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