Asked by steven remmenga on Jun 13, 2024
Verified
Which of the following is NOT a component of the Du Pont identity?
A) Operating efficiency
B) Asset use efficiency
C) Financial leverage
D) Profit per dollar of assets
E) Net working capital
Du Pont Identity
A financial analysis formula that breaks down return on equity into three components: profit margin, asset turnover, and financial leverage.
Operating Efficiency
A measure of the effectiveness and productivity with which a business or organization operates, often relating to how well it utilizes its resources.
Asset Use Efficiency
How effectively a company utilizes its assets to generate revenue.
- Understand the components of the Du Pont identity and its application in evaluating company performance.
Verified Answer
Learning Objectives
- Understand the components of the Du Pont identity and its application in evaluating company performance.
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