Asked by Diedre McCoy on Jun 19, 2024

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If an investor is considering two different companies as an investment,the investor should choose to invest with the company that has the highest net profit margin.

Net Profit Margin

A profitability ratio calculated by dividing net income by revenue, showing how much of each dollar in revenues results in profit.

  • Gain insight into the variables that affect earnings per share and the price/earnings ratio.
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Lucia MartinJun 21, 2024
Final Answer :
False
Explanation :
Net profit margin alone is not a sufficient indicator to make investment decisions. Other factors such as industry trends, company growth potential, financial stability, and management should also be taken into consideration.