Final answer:
Return on Equity (ROE) relates net income and stockholders' equity, measuring a company's profitability in using shareholders' equity to generate profit.
Step-by-step explanation:
The question relates to a key financial metric known as Return on Equity (ROE), which is essential in understanding a company's profitability and investment value.
ROE measures how effectively a company is using its shareholders' equity to generate profit and is calculated by taking the company's net income and dividing it by the shareholders' equity. Therefore, the correct answer to the question is C. Return on equity relates net income and stockholders' equity. This calculation helps investors determine the efficiency of equity used to support operations and grow the company. It does not directly relate to dividends, though dividends can be a component of the total return an investor receives.