The correct answer is B. 11.40%.
Return on common equity (ROE) is a measure of how profitable a company is relative to the amount of equity it has invested. It is calculated by dividing net income available to common stockholders by average common equity.
In this case, net income available to common stockholders is Rs 125 and total assets are Rs 1,096. Therefore, average common equity is Rs 548 (1,096 / 2). ROE is then calculated as follows:
ROE = Net income available to common stockholders / Average common equity
= 125 / 548
= 11.40%
Option A is incorrect because it is the return on assets (ROA), which is calculated by dividing net income by average total assets. Option C is incorrect because it is the return on investment (ROI), which is calculated by dividing net income by average invested capital. Option D is incorrect because it is the return on equity (ROE), which is calculated by dividing net income available to common stockholders by average common equity.