The DuPont Identity tells us that Return on Equity is affected by:

✅ A. Discounted payback period

Option A : Discounted payback period Option B : Discounted rate of return Option C : Discounted cash flows Option D : Discounted project cost Option E : Correct Answer : Discounted payback period Read more

✅ B. More than its par value

Option A : Seasoned par value Option B : More than its par value Option C : Seasoned par value Option D : At par value Option E : Correct Answer : More than its par value Read more

✅ D. All of Them

Option A : Stakeholders Option B : Creditors and customs Option C : Employees and suppliers Option D : All of Them Option E : Correct Answer : All of Them Read more

✅ C. Cost of capital is used

Option A : Component cost is used Option B : Common stock value is used Option C : Cost of capital is used Option D : Asset valuation is used Option E : Correct Answer : Cost of capital is used Read more

✅ A. Higher net present value

Option A : Higher net present value Option B : Lower net present value Option C : Zero net present value Option D : All of above Option E : Correct Answer : Higher net present value Read more

✅ D. None of the given options

Option A : Financing Option B : Investing Option C : Managing day today expenses Option D : None of the given options Option E : Correct Answer : None of the given options Read more

✅ C. High growth prospect

Option A : Low dividends paid Option B : High risk prospect Option C : High growth prospect Option D : High marginal rate Option E : Correct Answer : High growth prospect Read more

✅ C. Profitability Ratios

Option A : Liquidity Ratios Option B : Leverage Ratios Option C : Profitability Ratios Option D : Market Value Ratios Option E : Correct Answer : Profitability Ratios Read more