8 Return on Equity (ROE) is an indicator of the accounting profitability that gets the shareholder ...

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a. The higher, the better, since indebtedness does not affect risk.

b. Must be at least 3 times higher than the debt cost

c. A high ratio is a good indicator although the risk of financial indebtedness (leverage) should be analyzed, since a high ROE can also occur in a profitable company with very small equity and high leverage

d. A high ratio is a good indicator, although the risk of operating leverage and its effect on ROE should be also analyzed