Which of the following would be most useful in deciding whether or not to purchase a firm's common stock?
A)return on equity
B)return on assets
C)asset turnover
D)current ratio

Question

Quizplus · Accepted Answer

Return on equity (ROE) is a key financial ratio that measures the profitability of a company by expressing net income as a percentage of shareholders' equity. A higher ROE indicates that the company is more profitable and efficient at generating profits, which would make its common stock more attractive to potential investors. The other options (B, C, and D) are also important financial ratios, but they do not specifically measure profitability or the potential for returns on an investment in a company's common stock.

Which of the Following Would Be Most Useful in Deciding