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Return on Equity Is a Ratio That

Question 175

Multiple Choice

Return on equity is a ratio that:


A) shows the relationship between net income available for common stockholders and average common stockholders' equity.
B) is calculated by dividing net income plus preferred dividends by average common stockholders' equity.
C) cannot be calculated if the company has preferred stock in addition to common stock.
D) incorporates both A and B.

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