When a Company's ROE Is Greater Than Its ROA for a Given

question 125

Multiple Choice

When a company's ROE is greater than its ROA for a given time-period, it could be that

• A) the company could borrow at an after-tax rate that was higher than the rate earned by investing in assets
• B) the company could borrow at an after-tax rate that was less than the rate earned by investing in assets.
• C) the company has no debt
• D) the level of debt has no impact on the ROA

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Definitions:

Enhanced-Interrogation

A term often associated with methods used to extract information that may employ aggressive techniques, bordering on torture.

Torture-Based

Derived from or involving the use of severe physical or psychological pain as a means to punish, coerce, or obtain information.

Questioning

The process of exploring one's own sexual orientation or gender identity, considering how they might label themselves.

Managed Care Programs

Health care delivery systems that integrate the financing and delivery of health care services to subscribers, with an emphasis on controlling costs and improving quality.