Which is a measure of the efficiency of an investment

Question

e.cociuba · Answer

R u also finding the  return rate, return on investment or efficiency coefficient?

anonymous · Answer

Yea

e.cociuba · Answer

Anyone of those ratios can work but there is no single ratio that will show the return you will get out of a stock. The best thing is use those ratios compared to a company's competitors and see how strong the company is.
I do like Return on Equity, ROE, but my favorite that if you don't know about you should research is Return on Invested Capital, ROIC. The reason I like it is that companies can borrow large amounts of money and make their ROE go through the roof making it appeal to more people. ROIC takes into account the debt and assets and how they generate profit for the company.

anonymous · Answer

Ah well I'm on this question in class and it's asking: Which is a measure of the efficiency of an investment? A) return rate. / B) return on investment. / C) efficiency coefficient