In response to complaints about high prices, a grocery chain runs the following advertising campaign: If you

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In response to complaints about high prices, a grocery chain runs the following advertising campaign: “If you pay your child 50 cents to go buy $25 worth of groceries, then your child makes twice as much on the trip as we do.” You’ve collected the following information from the grocery chain’s financial statements:

(millions) Sales Net income Total assets Total debt $550.0 5.5 140.0 90.0

Evaluate the grocery chain’s claim. What is the basis for the statement? Is this claim misleading? Why or why not?

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Fundamentals Of Corporate Finance

ISBN: 9780072553079

6th Edition

Authors: Stephen A. Ross, Randolph Westerfield, Bradford D. Jordan

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