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Financial indicators of two different businesses

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Reference no: EM132204020

Consider the following financial indicators of two different businesses:

i. Returns on Assets: 24% and 24%

ii. Returns on the Owner's capital: 28% and 42%.

Why is it that it's acceptable for the Returns on Assets of the two businesses to be identical, but not the Returns on the Owner's capital, as it's apparent from the data above?

Reference no: EM132204020

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