If a firm decreases its operating costs, all else constant, then the: A. profit margin will decrease. B. return on assets will decrease. C. total asset turnover rate will increase. D. cash coverage ratio will decrease. E. price-earnings ratio will decrease Can you give me detailed explanation?
If a firm decreases its operating costs, all else constant, then the: A. profit margin will decrease. B. return on assets will decrease. C. total asset turnover rate will increase. D. cash coverage ratio will decrease. E. price-earnings ratio will decrease Can you give me detailed explanation?
Chapter3: Cost-volume-profit Analysis
Section: Chapter Questions
Problem 11MC: When sales price decreases and all other variables are held constant, the break-even point will...
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If a firm decreases its operating costs, all else constant, then the:
A. profit margin will decrease.
B.
C. total asset turnover rate will increase.
D. cash coverage ratio will decrease.
E. price-earnings ratio will decrease
Can you give me detailed explanation?
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