Which of the Following Equations Is Used to Calculate Return

question 16

Multiple Choice

Which of the following equations is used to calculate return on equity?

• A)Return on equity = net income/sales
• B)Return on equity = revenue - expenses
• C)Return on equity = net income/owners' equity
• D)Return on equity = assets + liabilities
• E)Return on equity = net income/total assets

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Definitions:

Trillion Mark

A reference to a period of hyperinflation in Weimar Germany where the mark, the currency at the time, devalued to the point where trillions were needed for basic transactions.

Budget Deficit

The situation where a government's expenditures exceed its revenues over a specified period, leading to borrowing or money printing.

Tax Receipts

The total amount of tax revenue collected by a government from individuals and businesses.

Automatic Stabilizer

Economic policies and programs designed to automatically reduce fluctuations in an economy's output, such as progressive taxation and welfare.