Question: 1) Based on the calculation , discuss relationship between ROA anfd ROE A company Z company Average of ROA 12% 10% Standard deviation of ROA

1) Based on the calculation , discuss relationship between ROA anfd ROE

A company

Z company

Average of ROA

12%

10%

Standard deviation of ROA

5.89%

5.57%

Standard deviation of ROE

8.45%

7.13%

2) which company has higher ROE and what is the reason of it?

3) which company has more volatility of roe and what is the reason of it ?

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