What Is the ROE for a Firm with a Times

question 52

Multiple Choice

What is the ROE for a firm with a times interest earned ratio of 2, a tax liability of $1 million, and interest expense of $1.5 million if equity equals $1.5 million? (Use the values in dollars)

• A)26.67%
• B)30.00%
• C)33.33%
• D)50.00%

---

Definitions:

Inguinal Ring

An anatomical structure in the groin area through which the spermatic cord (in men) and the round ligament of the uterus (in women) pass.

Direct Inguinal

Pertaining to a type of hernia that occurs when tissue protrudes directly through a weak spot in the abdominal muscles near the inguinal canal.

Femoral

Pertaining to the femur or thigh bone, often used in context of femoral arteries, nerves, or fractures.

Yellowish Nodules

Small, yellow-colored lumps on the skin, often indicative of underlying lipid disorders or specific dermatological conditions.