QUESTION 2 Which of the following statements is true? O A. Profit margin is calculated by dividing total assets by sales. OB. Return on Equity rises if equity increases and net income remain constant. OC. A 10% increase in cash will lead to a greater Cash Ratio OD. The current ratio increases if the current liabilities increase QUESTION 11 Which of the following statements is true ? O A. The DuPont Identity is used to calculate Return on Assets B. A company can imporve their P/E ratio by improving their EPS OC. A Market to Book ratio greater than 1 always means the stock is undervalued. D. All of the statements are false. QUESTION 12 As sales increase, a firm needs to proportionately to support the A. increase the level of fixed assets, increase the level of inventory OB. increase the level of inventory, higher sales level O c. increase the level of inventory, increase the level of fixed assets OD. None of the above