Which of the Following Statements Is True About Return on Equity

question 79

Multiple Choice

Which of the following statements is true about return on equity (ROE) ?

• A) It measures the return on common stockholders' investment in the assets of the firm.
• B) The value of the firm's ROE is affected by net income.
• C) The value of the firm's ROE is affected by the amount of financial leverage or debt that the firm uses.
• D) All of these choices are correct.

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Definitions:

Influencers

Individuals who have the power to affect the purchasing decisions of others, often through their authority, knowledge, or relationship with their audience.

Formal Authority

The power given to an individual or an entity based on their role or position within an organization, allowing them to make decisions and enforce rules.

Buying Center

A group of individuals within an organization who are involved in the decision-making process for purchasing goods or services.

Gatekeeper

In information theory, gatekeepers are individuals or policies that control the flow of information and access to resources within an organization.