A retailer has a net profit of $1,000,000, total assets of $12,000,000, a 2.5 asset turnover ratio, and a net worth of $5,000,000. What is its financial leverage ratio?
a. .083 times
b. .500 times
c. 2.00 times
d. 2.40 times
e. 4.80 times
Answer: D
Marketing MCQ
Retailing Chapter 2
A retailer has a net profit of $1,000,000, total assets of $12,000,000, a 2.5 asset turnover ratio, and a net worth of $5,000,000. What is its financial leverage ratio?