1) Price-to-book is a multiple that would be least relevant for which of the following companies?

	a.	Software company
	b.	Supermarket chain
	c.	Cement manufacturer
	d.	Specialty clothing retailer

2) Investment analysts employ ratio and trend analysis when assessing a companys financial statements. Some trends reveal company improvement and others suggest possible red flags trends that reveal possible deterioration in operational success. Which of the following would suggest a red flag?

(1)Rising accounts receivable versus sales ratio

(2)Rising inventory versus sales ratio

(3)Rising debt versus total asset ratio

(4)Rising shareholder equity to total assets ratio

	a.	1 and 2
	b.	1, 2 and 3
	c.	2 and 4
	d.	3 and 4

3) The Coastal Company had revenues of $120,000 in the last fiscal period. The cost-of-goods were $62,000, operational expenses were $15,000, interest was $8,000 and tax was $11,900. What is the return on equity if the companys total assets and total liabilities are $630,000 and $320,000, respectively?

	a.	7.5%
	b.	3.7%
	c.	7.2%
	d.	13.9%