Harley-Davidson, lnc., is a leading motorcycle manufacturer in the United States. The company manufactures and sells a number of different types of motorcycles, a complete line of motorcycle parts, and brand-related accessories, clothing, and collectibles. In recent years, Harley-Davidson has attempted to expand its dealer network and product lines internationally.

The following information is available for three recent years (in millions except per share amounts):

1. Calculate the following ratios for each year:
a. Rate earned on total assets
b. Rate earned on stockholders' equity
c. Earnings per share
d. Dividend yield
e. Price-earnings ratio
2. What is the ratio of average liabilities to average stockholders' equity for 2008?
3. Explain the direction of the dividend yield and price-earnings ratio in light of Harley-Davidson's profitability trend.
4. Based on these data, evaluate Harley-Davidson's strategy to expand to internationalmarkets.

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2008 2006 $934 $1,043 50.00 0.00 $0.00 $4.50 0.00 $0.00 2007 Net income (loss) Preferred dividends Interest expense Shares outstanding for $655 computing earnings per share Cash dividend per share Average total assets Average stockholders'equity Average stock price per share 258 1.29 $1.06 $0.81 S6,743 5,595 $5,394 2,246 $2,566 $2,921 31.29 58.44 $60.98 233 238