1. Studies document that stocks of companies that have had historically high rates of return on equity and asset growth ("excellent companies") perform relatively better than those that have had relatively low rates of return on equity and asset growth ("unexcellent companies"). Hint: be certain to watch chapter video.
a) True
b) False
2. TIE RATIO
MPI Incorporated has $6 billion in assets, and its tax rate is 40%. Its basic earning power (BEP) ratio is 11%, and its return on assets (ROA) is 3%. What is MPI's times-interest-earned (TIE) ratio? Round your answer to two decimal places.