Calculate roe when roe may be calculated more simply, Financial Management

Assignment Help:

Why would an analyst use the Modified Du Pont system to calculate ROE when ROE may be calculated more simply? Explain.

In fact, an analyst wouldn't use the Modified Du Pont equation to calculate ROE for exactly the reason stated above.  What an analyst would apply the Modified Du Pont equation for is to assist analyze the factors that contribute to a firm's ROE.  In other words, analysts utilize the Modified Du Pont system to "take apart" ROE to see what factors are influencing it.

 

 


Related Discussions:- Calculate roe when roe may be calculated more simply

Money market instruments, Just as any other financial market, money m...

Just as any other financial market, money market also involves transfer of funds in exchange for financial assets. Because of the nature of the money market, the

Describe career opportunities in the field of finance, List and describe th...

List and describe the three career opportunities in the field of finance? Finance has three key career paths: financial markets and institutions, financial management and inves

Budget, •What categories and in what amounts should Jenny allocate her fund...

•What categories and in what amounts should Jenny allocate her funds to reflect a balanced monthly budget? Include the main categories as well as examples of other categories.

Debt securities , lso from the auditor's report, they have reported that th...

lso from the auditor's report, they have reported that the company has used funds raised on short-term basis for long-term investment. The company has purchased certain fixed asses

Pension reforms, Pension Reforms On January 1, 2004, Pension Funds have...

Pension Reforms On January 1, 2004, Pension Funds have come into force in India. Government servants will have to subscribe to them. The new pension fund system is primarily dr

Explain why warrants are rarely exercised, Explain why warrants are rarely ...

Explain why warrants are rarely exercised unless the time to maturity is small? Warrants are hardly ever exercised until the time to expiration is small because the market pric

Cost of preference capital, Cost of Preference capital (K ) The fixed ...

Cost of Preference capital (K ) The fixed rate of dividend payable to the Preference share holders is the cost of Preference capital.  Exactly, the cost of Preference capital

Does high operating leverage always mean high business risk, Does high oper...

Does high operating leverage always mean high business risk?  Explain. High operating leverage doesn't always mean high business risk.  If the company's sales are quite steady

Ratio analysis, define ratio analysis. explain the advantages of ratio anal...

define ratio analysis. explain the advantages of ratio analysis

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd