The Rate of Return on Share Capital-Equity Is Calculated by Dividing

question 58

Multiple Choice

The rate of return on share capital-equity is calculated by dividing

• A)net income by average ordinary share holders' equity.
• B)net income less preference dividends by average ordinary share holders' equity.
• C)net income by ending ordinary share holders' equity.
• D)net income less preference dividends by ending ordinary share holders' equity.

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Definitions:

Domestic Investment

The total spending within a country on capital goods, which are used to produce other goods or services.

Exchange Rates

The value of one currency for the purpose of conversion to another, reflecting the market's opinion of the relative worth of currencies.

Euros

The official currency of 19 out of 27 European Union countries, which is also used in some non-EU countries.

Pounds

A unit of weight commonly used in the United States and British imperial system, equivalent to 0.453592 kilograms, or a unit of currency in the United Kingdom and some other countries.