1.) To stockholders, the larger the net income, the greater the likelihood of-

a. dividends

b. the company will purchase treasury stock

c. the stock price decreasing

d. all of the above

2.) A company has a return on assets of 8%. Return on sales are 4%. The leverage ratio is 3.0. Following DuPont analysis, what is return on equity?

a. 12%

b. 4%

c. 8%

d. 24%