In your position as research assistant to a portfolio manager, you need to analyze the profitability of the companies in the portfolio. Using the data for Electronic Arts, Inc. (NASDAQ: EA) below: a. Fiscal Year Total Revenue Net Income 2016 4,396 1,156 2015 4,515 875 2014 3,575 8 2013 3,797 98 2012 4,143 76 Calculate the net profit margin for each year. Calculate the compound average annual growth rates (CAGR) for revenue and net income using the GEOMEAN function. Is net income growing more slowly or faster than total revenue? Is this a positive for your investment in the company? Calculate the average annual growth rate of total revenue using the AVERAGE function. Is this result more or less accurate than your result in the previous question? Why?

In your position as research assistant to a portfolio manager, you need to analyze the profitability of the companies in the portfolio. Using the data for Electronic Arts, Inc. (NASDAQ: EA) below: a. Fiscal Year Total Revenue Net Income 2016 4,396 1,156 2015 4,515 875 2014 3,575 8 2013 3,797 98 2012 4,143 76 Calculate the net profit margin for each year. Calculate the compound average annual growth rates (CAGR) for revenue and net income using the GEOMEAN function. Is net income growing more slowly or faster than total revenue? Is this a positive for your investment in the company? Calculate the average annual growth rate of total revenue using the AVERAGE function. Is this result more or less accurate than your result in the previous question? Why?

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

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