Multiple Choice
Garner Inc. and Tanex Corp. are competitors in the equipment manufacturing industry. Garner has a P/S ratio of 3.2, whereas Tanex has a P/S ratio of 1.8. Which of the following best justifies the difference in P/S ratios between the two firms? Relative to Garner, Tanex has a:
A) higher total asset turnover.
B) lower beta.
C) lower net profit margin.
D) lower total asset turnover.
Correct Answer:
Verified
Correct Answer:
Verified
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