expansion plan, such as launch new products and entrance a new market in order to compete with its competitors. The most common and useful measurement of a good business is by calculating its profit through return on stockholders equity (ROE). ROE shows how much return that stockholders have earned on the capital that have been invested by stockholders into a business. Net Income ROE = ________________ Stockholders EquityHigh rates of return on stockholders equity indicate a good business performance and also high growth rate of sales.Besides steady growth of sales and high rates of return on equity, a good business must also have strong brand equity. It is important for a firm to create an image of its products on buyers mind so that buyers become loyal to the firms brand. Strong brand equity also generates higher profit since consumers want to pay more because of the reputation that the product have; moreover, it works as a powerful defense against new competitors.From the above characteristics of a good business, there are some examples of companies which meet these certain characteristics, such as Microsoft Corporation, General Electric Company, Wal-Mart Stores, Inc., and Intel Corporation. Table of the position of four companies that are considered a good business.Promising ProspectSales GrowthROE (1999)Brand EquityMicrosoft CorporationYES16.3%49.8%YESGeneral Electric CompanyYES10.7%27.6%YESWal-Mart Stores, Inc.YES19.9%23.9%YESIntel CorporationsYES11.9%31.3%YESSales Growth based on most recent fiscal year....
