Think about some of the influences and measures of company performance that you read about this week.
Explain the use of return on assets (ROA) and the price-to-earnings (PE) ratio in evaluating the
performance of a company.
Write about how to calculate ROA and PE ratio and how market conditions can affect these metrics.
Share the ROA and PE ratio for a company you are familiar with. What do these metrics tell you about the
financial health of the company?
Sample Solution
