3. The total interest expense is half the Net Interest Income that is $225,000 which represent 80% from the adjusted operating income. The profit margin is 4.4% and the asset utilization ratio is 45% and the capitalization ratio is 25%. Then how much does ROE exceeds ROA of this Bank if the average earning assets are 65% from the total assets? choose the nearest choice O 1.98% O 2.33% O 5.94% O 10% O None of the above
3. The total interest expense is half the Net Interest Income that is $225,000 which represent 80% from the adjusted operating income. The profit margin is 4.4% and the asset utilization ratio is 45% and the capitalization ratio is 25%. Then how much does ROE exceeds ROA of this Bank if the average earning assets are 65% from the total assets? choose the nearest choice O 1.98% O 2.33% O 5.94% O 10% O None of the above
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Financial Ratios
A Ratio refers to a figure calculated as a reference to the relationship of two or more numbers and can be expressed as a fraction, proportion, percentage, or the number of times. When the number is determined by taking two accounting numbers derived from the financial statements, it is termed as the accounting ratio.
Return on Equity
The Return on Equity (RoE) is a measure of the profitability of a business concerning the funds by its stockholders/shareholders. ROE is a metric used generally to determine how well the company utilizes its funds provided by the equity shareholders.
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Transcribed Image Text:3. The total interest expense is half
the Net Interest Income that is
$225,000 which represent 80% from
the adjusted operating income. The
profit margin is 4.4% and the asset
utilization ratio is 45% and the
capitalization ratio is 25%. Then how
much does ROE exceeds ROA of this
Bank if the average earning assets
are 65% from the total assets?
choose the nearest choice *
1.98%
2.33%
5.94%
10%
None of the above
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