Company ABC has a return on assets of 3.2% and a return on equity of 12%. Company XYZ has a return on assets of 3.2% and a return on equity of 18%, What is the likely principal reason for the difference?

A

ABC's equity market price is greater than XYZ equity market price.

B

XYZ has a higher level of leverage than ABC.

C

XYZ's total assets are less than ABC's total assets.

D

ABC's total assets are less than XYZ's total assets.