Which of the following ratios measures the return the firm earned on its owner's investment in the firm?
A) times interest earned
B) net profit margin
C) return on assets
D) return on equity

Question

Quizplus · Accepted Answer

Return on equity (ROE) measures the return that the company earned on its owner's (shareholder's) investment in the firm. It is calculated by dividing net income by shareholder equity, showing how effectively the company uses the investments made by its shareholders to generate profits.

Which of the Following Ratios Measures the Return the Firm