Dennis's stockholders want him to constantly improve his firm's ________ ratio because it would improve the future value of their investment in the firm.

Question

Quizplus · Accepted Answer

Return on equity (ROE) is a financial ratio that measures the amount of profit a company generates from shareholders' equity. Shareholders are interested in maximizing the return on their investment, and a higher ROE indicates that a company is utilizing its resources more efficiently to generate profits. Therefore, improving the ROE ratio would likely lead to an increase in the future value of their investment in the firm.

Dennis's Stockholders Want Him to Constantly Improve His Firm's ________