Suppose you are trying to decide whether to invest in a company that generates a high expected ROE, and you want to conduct further analysis of the company’s performance. If you wanted to conduct a comparative analysis for the current year, you would

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Answer: If you wanted to conduct a comparative analysis for the current year, you would ANALYZE THE FIRM'S FINANCIAL RATIOS OVER TIME (FROM PREVIOUS YEARS, WITH MUCH CONCENTRATION ON THE CURRENT YEAR)- WHICH HELPS IN ESTIMATING THE LIKELIHOOD OF IMPROVEMENT OR DETERIORATION IN ITS FINANCIAL CONDITION, AND WILL EVENTUALLY HELP TO ADDRESS THE ISSUES OF THE CURRENT YEAR.