Practice mode Finance

What do a company’s low earning power and high interest costs cause?

Correct answer D. Low return on assets

Explanation

Low basic earning power reduces operating profit, and high interest charges cut net income further, so net income relative to total assets, the return on assets, is low.

Report a problem

Answer checked How we write and check questions

Tip: press A, B, C or D to answer, and N for the next question.

Advertisement

Have a question about this answer?

Your email address will not be published. Required fields are marked *

Links and website addresses are not allowed in comments.