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1. Bank B has an equity multiplier of 11.00   2. Bank B has a profit margin of 16.67% and an Asset Utilisation Ratio of 6.00%   3. Bank B has a profit margin of

1. Bank B has an equity multiplier of 11.00   2. Bank B has a profit margin of 16.67% and an Asset Utilisation Ratio of 6.00%   3. Bank B has a profit margin of

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Bank A has a Return on Equity (ROE) of 16.00% and a Return on Assets (ROA) of 2.00%. Bank B has a Return on Equity (ROE) of 17.60% and a Return on Assets (ROA) of 1.60%. Using this information,   Which is of the following is NOT possible?

Which is the correct option 

OPTIONS

1. Bank B has an equity multiplier of 11.00
 
2. Bank B has a profit margin of 16.67% and an Asset Utilisation Ratio of 6.00%
 
3. Bank B has a profit margin of 28.00% and an Asset Utilisation Ratio of 5.71%
 
4. Bank A has an equity multiplier of 8.00
 
5. Bank A has a profit margin of 18.00% and an Asset Utilisation Ratio of 11.11%
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