Which of the following provides a measure of return earned by resources invested only by the common shareholders?

Question

Quizplus · Accepted Answer

ROE (Return on Equity) measures the return earned by resources invested only by the common shareholders, reflecting the profitability of the company from the perspective of its equity investors. EPS (Earnings per Share) measures the earnings per each outstanding share of common stock and doesn't provide a measure of return on investment. D/E (Debt-to-Equity) measures the proportion of debt capital to equity capital and doesn't provide a measure of return on investment. ROA (Return on Assets) measures the return earned by all resources invested in the company, including both debt and equity capital.

Which of the Following Provides a Measure of Return Earned