CALCULATING AND INTERPRETING THE RATE OF RETURN ON COMMON SHAREHOLDERS' EQUITY AND EARNINGS PER COM- MON SHARE. Selected data for General Mills for 2007, 2008, and 2009 appear below (amounts in millions).
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2009
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2008
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2007
|
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Net Income
Weighted Average Number of Common Shares Outstanding
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$1,304.4
331.9
|
$1,294.7
333.0
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$1,144.0
346.5
|
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Average Common Shareholders' Equity
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$5,695.3
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$5,767.4
|
$5,545.5
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Required
a. Compute the rate of ROCE for 2007, 2008, and 2009.
b. Compute basic EPS for 2007, 2008, and 2009.
c. Interpret the changes in ROCE versus EPS over the three-years period.