QUESTION 3 10 points Answer one of the following questions: a- Company XYZ took a loan in 2019, and the amount was AED 2000,000 with 5% interest, and the net income before interest was AED 650,000 in 2020, the company took another loan, and the amount was AED 2000,000 with 10% interest, and the net income before interest was AED 800.000 Although the net income increased in 2020, the return on equity (ROE) decreased compared to 2010. The number of shares has been the same for the two years Required: As a financial analyst, you have been asked by a client to explain why the ROE decreased in 2020 though the net income increased in the same year. Explain your answer. b- The following are the information on the "operating cycle" and "days accounts payable outstanding" for Company A. Company B, and Company C -The operating cycle for Company A is 50 days, and the days accounts payable outstanding is 30 - The operating cycle for Company B is 70 days, and the days accounts payable outstanding is 80. -The operating cycle for Company C is 30 days, and the days accounts payable outstanding is 30. Required: Which company of the three companies has the most short-term liquidity problem? Explain your answer.