The probability of financial distress depends on the ________
A) likelihood that a firm will be unable to meet its debt commitments
B) chance that a firm's raw material costs will increase
C) likelihood of dividend payments
D) likelihood of asset growth
Answer: A
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Operating return on assets is equal to the operating profit margin times total asset turnover
Indicate whether the statement is true or false
Which of the following parity conditions is (are) correct?
A) The purchasing-power parity theory states that in the long run exchange rate changes tend to reflect international differences in inflation rates. B) The interest-rate parity theory states that the forward premium/discount should be equal and opposite in size to the national interest rate differential. C) The international Fisher effect states that national interest rate differentials are the result of inflation differentials. D) All of the above are correct.