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Business A has a profit margin lower than Business B. Business A and Business B share...

Business A has a profit margin lower than Business B.

Business A and Business B share the same amount of TOTAL LIABILITIES

Business A and Business B share the same amount of TOTAL EQUITY

Is it possible for Business A's ROE to be the same as Business B's ROE?

  1. NO, it is not possible
  2. Yes, if Business A TOTAL ASSET TURNOVER is higher than Business B.
  3. Yes, if Business A TOTAL ASSET TURNOVER is the same as Business B
  4. Yes, if Business A TOTAL ASSET TURNOVER is lower than Business B
  5. Yes, if Business A ROA is higher than Business B

A business has a profit margin above the industry average, yet its ROA is equal to the industry average. Is this possible?

  1. No
  2. Yes, if TOTAL ASSET TURNOVER is below the industry average
  3. Yes, if the Business has no liabilities
  4. Yes, if the EQUITY MULTIPLIER is below the industry average
  5. Yes, it is possible, but b,c and d above are not the correct reason  

JJ Corporation has a profit margin above the industry average, yet its ROA is equal to the industry average. Is this possible?

  1. No
  2. Yes, if JJ’s TOTAL ASSET TURNOVER is below the industry average
  3. Yes, if JJ Corporation has no liabilities
  4. Yes, if JJ’s EQUITY MULTIPLIER is below the industry average
  5. Yes, it is possible, but b,c and d above are not the correct reason  

4) JJ Corporation has a profit margin above the industry average, yet its ROA is equal to the industry average. Is this possible?

  1. No
  2. Yes, if JJ’s TOTAL ASSET TURNOVER is below the industry average
  3. Yes, if JJ Corporation has no liabilities
  4. Yes, if JJ’s EQUITY MULTIPLIER is below the industry average
  5. Yes, it is possible, but b,c and d above are not the correct reason  
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