1. During the latest year Ruth Corp. had the following ratios: profit margin=4%, total asset turnover=2, total debt to total assets ratio=60%. Based on the Du Pont equation, what was the firm's ROE? A. 4.80% B. 8.00% C. 13.33% D. 15.00% E. 20.00%
2. Weak-form market efficiency implies that recent trends in stock prices are of no use in predicting future stock prices. Why do you think this is a correct statement?
3. As a young CFO, given th new tax bill and the current interest rate and stock market environment how would you arrange your capital structure?
4. Why are the functional managers fighting about whether they go with BigCoSoft or LargeCoSoft?