To determine how well her business is doing, Darlene should monitor the return on her investment (equity) because it is a better measure of performance than the
A) return on assets ratio.
B) current ratio.
C) quick ratio.
D) absolute dollar amount of net profits.

Question

Quizplus · Accepted Answer

Return on equity (ROE) measures how effectively a company uses its equity to generate profits, providing a clearer picture of performance than just looking at net profits, which don't account for the size of the investment.

To Determine How Well Her Business Is Doing, Darlene Should