A measure of how well a company produces income with the amount of investment that common shareholders have made in the company is the ________.

Question

Quizplus · Accepted Answer

Return on equity (ROE) is a profitability ratio that measures the return that common shareholders earn on their investment in the company. It is calculated by dividing the net income of the company by the average common equity of the company during the period. ROE is a key indicator of a company's profitability and ability to generate earnings from the investment of its common shareholders.

A Measure of How Well a Company Produces Income with the Amount