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Montano1993 [528]
3 years ago
7

Carter, Inc., a manufacturer of electrical supplies, has an ROE of 23.1 percent, a profit margin of 3.30 percent, and a total as

set turnover ratio of 1.60 times. Its peer group also has an ROE of 23.1 percent but has out performed Carter with a net profit margin of 3.59 percent and a total assets turnover ratio of 2 times. Calculate the Carter's equity multiplier and peer group equity multiplier.
Business
1 answer:
never [62]3 years ago
5 0

Answer:

The Carter's equity multiplier and peer group equity multiplier is 4.375 and 3.21 respectively.

Explanation:

For computing the Return on equity based on equity multiplies the following formula is used which is shown below:

Return on Equity = Net Profit margin × Total assets turnover × Equity multiplier

Since ROE, profit margin and Total assets turnover ratio is given. The Equity multiplier can be easily calculated.

Carter equity multiplier = Return on Equity ÷ (profit margin and Total assets turnover ratio)

= 23.1% ÷ (3.30% × 1.60 times)

= 4.375

Peer group equity multiplier = Return on Equity ÷ (profit margin and Total assets turnover ratio)

= 23.1% ÷ (3.59% × 2 times)

= 3.21

Hence, the Carter's equity multiplier and peer group equity multiplier is 4.375 and 3.21 respectively.

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c) Rick has an external locus of control.

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The external locus of control can pose a challenge for Rick in the sense that an entrepreneur's success is related to his own personal control and personal efforts to make the business viable and successful in the market. It is necessary for the entrepreneur to understand that there are risks inherent to the business and that a business can work according to their efforts, learning and planning, that is, the entrepreneur and their control and management actions will be responsible for the success or failure of the business, and not just external factors like fate or bad luck.

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3 years ago
The Shoe Box is considering adding a new line of winter footwear to its product lineup. When analyzing the viability of this add
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Answer:

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Jillian has just started her first job with a $45,000 salary at a company with a 401(k) plan that has a 100% match up to 3% gros
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Answer:

Jillian

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Explanation:

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Employer's match to the 401(k) = $1,350 (100%)

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Answer:

d. Transactions exposure.

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Transactions exposure -

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It is the risk which currency exchange rates would fluctuate after the firm has taken a financial obligation .

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3 years ago
"You are reading a particular section of a bank’s annual report. This section provides the bank’s views about the impact of an u
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Answer:

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3 years ago
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