Answered: From the investor's point of view, how…

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From the investor's point of view, how is the rate of return on common equity a good indicator?

Economics Today and Tomorrow, Student Edition

1st Edition

ISBN:9780078747663

Author:McGraw-Hill

Publisher:McGraw-Hill

Chapter6: Saving And Investing

Section: Chapter Questions

Problem 15AA

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Question

From the investor's point of view, how is the rate of return on common equity a good indicator?

Definition Definition Percentage gain or loss from a specific investment over time. The rate of return is the difference between the closing and initial values of an investment divided by the initial value of the investment. The closing value includes any intermediate cash flows such as dividends or interest amounts.

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