Your physics homework can be a real challenge, and the due date can be really close - feel free to use our assistance and get the desired result.
Be sure that math assignments completed by our experts will be error-free and done according to your instructions specified in the submitted order form.
Our experts will gladly share their knowledge and help you with programming homework. Keep up with the world's newest programming trends.
Get a free quote.
Check the website
for updates.
Receive your completed assignment.
Easy as ABC!
Just provide us with clear instructions and wait for the completed assignment.

Answer on Economics of Enterprise Question for LaMarcus Streeter

Question #6764

4. Companies HD and LD have identical amounts of assets, operating income (EBIT), tax rates, and business risk. Company HD, however, has a much higher debt ratio than LD. Company HD’s basic earning power ratio (BEP) exceeds its cost of debt (rd). Which of the following statements is CORRECT?

a. Company HD has a higher return on assets (ROA) than Company LD.
b. Company HD has a higher times interest earned (TIE) ratio than Company LD.
c. Company HD has a higher return on equity (ROE) than Company LD, and its risk, as measured by the standard deviation of ROE, is also higher than LD’s.
d. The two companies have the same ROE.
e. Company HD’s ROE would be higher if it had no debt.

Expert's answer

e. Company HD's ROE would be higher if it had no debt.
Because the debt of
HD is higher, so its ROE is smaller.

Comments

2013-03-13 00:10:40
Sam wrote

This is wrong. More debt will equal a HIGHER ROE

2014-04-10 08:56:30
Expert's answer

Dear Sam,
We kindly regret about that mistake. We strive to improve our experts' work.

Thank you a lot.

Leave a comment

Related Questions

Link to us

Share with friends

Get homework help with Assignment Expert:
free questions
Questions and Answers
approved by clients
I received a perfect score on this. The expert provided more than enough detail for each problem that not only helped my understanding of the concepts in the assignment but got me a solid score on the assignment itself. Can't ask for more than that!
I rate AssignmentExpert.com: 5 out of 5.
Rating: 5
Minh Quan Vo on
solving policy
solving policy
satisfaction
guarantee
paypal