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Assume Firm A cycles through its assets exactly once every year, and its competitor, Firm B, cycles through its assets every 0.75 years. If the
Assume Firm A cycles through its assets exactly once every year, and its competitor, Firm B, cycles through its assets every 0.75 years. If the firms have the same revenue, net income, and debt-to-assets, which of the following is true?
a. | Both firms will provide the same return to their shareholders. | |
b. | Firm B will provide a higher return to its shareholders. | |
c. | Insufficient information is provided to select any of the answers as the correct answer. | |
d. | Firm A will provide a higher return to its shareholders. |
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