A Firm with a Debt-Equity Ratio of 0

question 81

Multiple Choice

A firm with a debt-equity ratio of 0.5,a return on assets of 14%,and a return on debt of 8%,will have a return on equity of:

• A) 15.25%.
• B) 16.00%.
• C) 17.00%.
• D) 17.33%.

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Definitions:

Law

A system of rules created and enforced through social or governmental institutions to regulate behavior, with its precise definition a matter of longstanding debate.

Socially Constructed

A concept or perception that has been created and accepted by the people in a society through cultural and social practice.

Relative

Considered in relation or in proportion to something else; not absolute.

Crime

Acts or omissions that constitute offenses against the public, punishable by law, and involve harm to society or its norms.