Answer: 0.80.

## Explanation The total asset turnover ratio is calculated as: **Total Asset Turnover = Revenue / Average Total Assets** We are given: - Revenue = €20 million - ROA (Return on Assets) = 4% - ROE (Return on Equity) = 10% - Average Shareholders' Equity = €10 million First, we need to find Average Total Assets. We can use the ROA formula: **ROA = Net Income / Average Total Assets** We don't have Net Income directly, but we can find it using ROE: **ROE = Net Income / Average Shareholders' Equity** So: Net Income = ROE × Average Shareholders' Equity = 10% × €10 million = €1 million Now we can find Average Total Assets using ROA: ROA = Net Income / Average Total Assets 4% = €1 million / Average Total Assets Average Total Assets = €1 million / 0.04 = €25 million Now calculate Total Asset Turnover: Total Asset Turnover = Revenue / Average Total Assets = €20 million / €25 million = 0.80 Therefore, the correct answer is **A. 0.80**. **Verification:** - ROA = Net Income / Total Assets = 1/25 = 4% ✓ - ROE = Net Income / Equity = 1/10 = 10% ✓ - Total Asset Turnover = Revenue / Total Assets = 20/25 = 0.80 ✓

Author: LeetQuiz .