Use the following information for the question(s) that follow. Patco and Ramsco are competitors in the same industry and have the followine Current ratio Debt/equity Total asset turnover Net profit margin Return on equity Dividend navout ratio Patco 1.2 0.60 2.6 5.2% 16.4% 15.0% Ramsco Industry Average 1.89 1.5 0.40 0.45 2.1 2.5 4.8% 5.0% 13.8% 15.0% 20.0% 22.0% OA. Ramsco is using leverage more aggressively than Patco. OB. Ramsco is reinvesting a higher percentage of its earnings in the busine C. Ramsco is using assets more efficiently than Patco. OD. Ramsco is more liquid than Patco.

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
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Use the following information for the question(s) that follow.
Patco and Ramsco are competitors in the same industry and have the following ratios.
Current ratio
Debt/equity
Total asset turnover
Net profit margin
Return on equity
Dividend navout ratio
Patco
1.2
0.60
2.6
OO
5.2%
16.4%
15.0%
Ramsco
1.89
0.40
2.1
4.8%
13.8%
22.0%
Industry Average
1.5
0.45
2.5
5.0%
15.0%
20.0%
A. Ramsco is using leverage more aggressively than Patco.
B. Ramsco is reinvesting a higher percentage of its earnings in the business than Patco.
OC. Ramsco is using assets more efficiently than Patco,
D. Ramsco is more liquid than Patco.
This question: 1 point(s) possible
Transcribed Image Text:K Use the following information for the question(s) that follow. Patco and Ramsco are competitors in the same industry and have the following ratios. Current ratio Debt/equity Total asset turnover Net profit margin Return on equity Dividend navout ratio Patco 1.2 0.60 2.6 OO 5.2% 16.4% 15.0% Ramsco 1.89 0.40 2.1 4.8% 13.8% 22.0% Industry Average 1.5 0.45 2.5 5.0% 15.0% 20.0% A. Ramsco is using leverage more aggressively than Patco. B. Ramsco is reinvesting a higher percentage of its earnings in the business than Patco. OC. Ramsco is using assets more efficiently than Patco, D. Ramsco is more liquid than Patco. This question: 1 point(s) possible
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