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Basic Question 8 of 23
Two companies operating in the same industry achieved the same return on equity with the same net sales; the two companies were different with respect to return on total assets. Compared with the company that had the higher return on total assets, the company with the lower return on total assets most likely had a higher ______.
B. financial leverage multiplier
C. proportion of common equity in its capital structure
A. total asset turnover
B. financial leverage multiplier
C. proportion of common equity in its capital structure
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Learning Outcome Statements
explain liquidity and compare issuers' liquidity levels
CFA® 2025 Level I Curriculum, Volume 2, Module 4.