Return on equity can be expressed mathematically as "(net profit margin) x (total asset turnover) x (equity multiplier)."

Name: Return on equity can be expressed mathematically as "(net profit margin) x (total asset turnover) x (equity multiplier)."
Brand: Quizplus
Rating: 4.8 (45 reviews)

Question

Quizplus · Accepted Answer

This is known as the DuPont Identity, which breaks down return on equity into three components: net profit margin, total asset turnover, and equity multiplier.

Return on Equity Can Be Expressed Mathematically as "(Net Profit