1.You heard on the internet that the CEO of Boeing got a huge bonus because the firm's return on equity (net income/equity) increased.Does this make sense to you?

2.What is implied by the fact that a firm's equity multiplier increased while the firm's ROE was constant?

3.What is implied by the fact that a firm's return on assets increased while their profit margin decreased?

4.What ratios would you examine to explain why a firm's operating margin decreased (be as specific as possible)?

5.In your opinion, what is the single most relevant traditional based performance measure (consider all of the ratios provided on the PDF document entitled "DuPont Ratios")?Explain your selection!

6.In 2019, a firm issued a significant amount of debt (bonds) and repurchased their equity (stock) with the funds raised from the debt offering (a debt for equity swap).The objective of this dramatic increase in leverage was to lower the firm's WACC.Their analysis suggests that the firm's WACC will decrease from 8% to 6% due to this debt for equity swap.Based on the Dupont model, how would this change in capital structure impact the firm's future performance (profitability)?Does your response change if you use operating income versus net income to complete the Dupont analysis?

7.What are the similarities and the differences between the following two performance measures: Operating Margin and Profit Margin?