BP plc reported the following financial information:

• Total assets: $284 billion
• Total liabilities: $186 billion
• Total equity: $98 billion
• Net income: $4.0 billion
• Total revenue: $305 billion
• Total expenses: $301 billion
• Earnings per share (EPS): $1.20
In a detailed paragraph, explain how to calculate the Return on Equity (ROE) for BP plc, providing the formula and interpretation. ROE is a critical profitability ratio that measures a company's ability to generate profit from shareholders' equity. It represents the return generated on shareholders' investments. Understanding ROE is essential for investors as it provides insights into how effectively the company is using equity to generate profits. To calculate ROE for BP plc, the formula involves dividing net income by total equity:
• Net income: $4.0 billion
• Total equity: $98 billion Interpret the calculated ROE value, highlighting the significance of the ratio in assessing BP plc's performance and attractiveness as an investment opportunity.