All else the same, lower ﬁxed asset turnover ratio would likely be associated with a ﬁrm which has a
high capital intensity ratio, relative to other ﬁrms in the same industry.

Question

Quizplus · Accepted Answer

The fixed asset turnover ratio measures a company's efficiency in generating sales from its fixed assets. A lower ratio indicates that the company is generating less revenue from its fixed assets. If the company has a high capital intensity ratio, it means that it has invested more heavily in fixed assets, which would make it more difficult to generate revenue and result in a lower fixed asset turnover ratio.

All Else the Same, Lower ﬁXed Asset Turnover Ratio Would