Summarizes return on equity and beta

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The following table summarizes return on equity (ROE) and beta for each of three major automotive firms:

Chrysler: ROE = 14.00%; Beta = 1.20

Ford Motor: ROE = 16.00%; Beta = 1.10

General Motors: ROE = 11.50%; Beta = 1.15

The risk-free rate of return is 5.50% and the market rate of return in 10.50%. Based on the ROE-to-Ke return differential, which firm created value?

A. I and II only

B. I and III only

C. II and III only

D. I, II, and III

Reference no: EM131541425

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