1. If a company has a higher net profit margin than most of its competitors, this means that:

The company is more efficient with its assets

The company has more loyal customers

The company has a lower proportion of debt financing

The company has a higher proportion of each sales dollar that is profit

2. When DuPont analysis reveals that a company has much higher than average asset turnover and much lower than average profit margin, meaning, they move product quickly and sell at below market prices, what can be concluded about the company’s strategy?

It is a product differentiator

It is a low-cost provider

It has no strategy

It needs to concentrate on improving it profit margins