Which of the Following Will Increase Return on Equity

question 41

Multiple Choice

Which of the following will increase return on equity?

• A) An increase in sales with a proportionate increase in costs and expenses
• B) An increase in sales relative to the asset base
• C) A decrease in leverage
• D) Both A and C

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Definitions:

Public Issues

Refers to the offering of securities, like stocks or bonds, to the public to raise capital.

Renegotiate

The process of revising the terms of a contract or agreement.

Market Value

The current price at which an asset or service can be bought or sold, determined by the supply and demand dynamics in the market.

Rights Offering

A method by which a company raises capital by offering existing shareholders the chance to buy additional shares at a discount.