When Will Return on Equity Equal Return on Capital

question 47

Multiple Choice

When will return on equity equal return on capital?

• A)whenever the firm has equal debt and equity financing.
• B)whenever the firm has no interest payments on debt.
• C)whenever the value of the firm's assets exceeds the value of its equity.
• D)ROE will never equal ROC.

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Definitions:

Parasympathetic Stimulation

The activation of the parasympathetic nervous system, leading to responses such as decreased heart rate and increased digestive activity.

Insulin

A hormone produced by the pancreas that regulates blood glucose levels by facilitating the uptake of glucose into cells.

Reabsorbed

The process by which substances are taken back into the bloodstream from bodily fluids or tissues, typically referring to the action of the kidneys.

Adh

Anti-diuretic hormone, also known as vasopressin, which regulates water balance in the body by controlling the amount of water absorbed by the kidneys.