2) If shareholders want to know how much profit a firm is making on their entire investment in the firm, the shareholders should look at the:

A. profit margin.

B. return on assets.

C. return on equity.

D. equity multiplier.

E. earnings per share.

3) The present value of a growing perpetuity ______________________ as the growth rate is increased, keeping the interest rate and the amount of perpetuity the same. (2 points) A. increases B. decreases C. stays the same