Final answer:
Return on equity is different from the options given; it is specifically related to the profitability of a company in relation to shareholder equity, and the correct answer is 4) none of these.
Step-by-step explanation:
The term return on equity (ROE) refers to a financial ratio that measures the profitability of a company in terms of the equity held by the shareholders. It is an important indicator of financial performance, calculated by dividing the company's net income by the shareholders' equity. The correct term for return on equity is none of the options provided. While return on investment (ROI) could seem similar because it measures the overall efficiency of an investment, it is not specific to equity. Return on assets (ROA) measures a company's earnings in relation to all its assets and is certainly not another term for ROE. Return on retained earnings looks at the profit growth attributed to the earnings that were not paid out as dividends. Therefore, the answer is 4) none of these.
Return on equity, also known as return on retained earnings, is a financial ratio that measures the profitability of a company. It calculates the return that shareholders receive on their investment in the company. This ratio is calculated by dividing the net income by the average shareholders' equity. So, the correct answer is option 3) return on retained earnings.