For a given level of profitability as measured by profit margin, the firm's return on equity will
A) increase as its debt-to-assets ratio decreases.
B) decrease as its current ratio increases.
C) increase as its debt-to-assets ratio increases.
D) decrease as its times-interest-earned ratio decreases.

Question

Quizplus · Accepted Answer

The Answer of For a given level of profitability as measured by profit margin, the firm's return on equity will
A) increase as its debt-to-assets ratio decreases.
B) decrease as its current ratio increases.
C) increase as its debt-to-assets ratio increases.
D) decrease as its times-interest-earned ratio decreases.

For a Given Level of Profitability as Measured by Profit