The rate of return on gross book value will not change if operating income remains constant.

Name: The rate of return on gross book value will not change if operating income remains constant.
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Question

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The rate of return on gross book value (ROGBV) is calculated as net income divided by the gross book value of assets. If operating income remains constant, net income will also remain constant, therefore ROGBV will not change.

The Rate of Return on Gross Book Value Will Not