How important should changes in roe be in the decision

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Reference no: EM132471059

Envision Inc. is considering the acquisition of a very promising technology company. One managerial person argues against the move, pointing out that because the technology company is presently losing money, the acquisition will cause company's return on equity to fall.

Question a. Is the managerial correct in predicting that ROE will fall?

Question b. How important should changes in ROE be in this decision?

Reference no: EM132471059

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