If a fiRm Decreases Its Operating Costs, All Else Constant

Multiple Choice

If a firm decreases its operating costs, all else constant, then:

A) The profit margin increases while the return on equity decreases.
B) The return on assets increases while the return on equity decreases.
C) The total asset turnover rate decreases while the profit margin increases.
D) Both the profit margin and the equity multiplier increase.
E) Both the return on assets and the return on equity increase.