The rate of return on total assets measures how effectively management has used the assets of the company.

Question

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The rate of return on total assets (ROTA) is a financial ratio that measures the efficiency of a company in using its assets to generate profits. It indicates how much profit a company is able to generate from its total assets, which can help investors to evaluate the effectiveness of management in using the company's resources. A higher ROTA is generally better, as it indicates that a company is able to generate more profits from its assets.

The Rate of Return on Total Assets Measures How Effectively