Computing Return on Equity
Starbucks reports net income for 2012 of $1,383.8 million. its stockholders' equity is $4,387.3 million and $5,114.5 million for 2011 and 2012, respectively.
a. Compute its return on equity for 2012.
b. Starbucks repurchased over $501 million of its common stock in 2012. how did this repurchase affect starbucks' rOe?
c. Why do you think a company like starbucks repurchases its own stock?