The Gold Company earned 18 percent on equity, whereas the Blue Company earned only 14 percent on equity. Does this mean that Gold will grow faster than Blue? Explain.
B) Give an example of how a cash flow ratio might differ from a proportion of debt ratio. Assuming these ratios differ for a firm (e.g., the cash flow ratios indicate high financial risk, while the proportion of debt ratio indicates low risk), which ratios would you follow? Justify your choice