Sometimes Analysts Use Other Ratios Such as Price-To-Book or Price-To-Sales

question 29

Multiple Choice

Sometimes analysts use other ratios such as price-to-book or price-to-sales ratio. Which of the following is a weakness of the use of these ratios?

• A) Some companies are structured very differently, especially across industries.
• B) A price-to-book value less than one cannot be assessed.
• C) A high price-to-sales ratio cannot be assessed.
• D) The price-to-sales ratio cannot be used for companies that report a net loss.

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Definitions:

Facial Nerve

The seventh cranial nerve that controls the muscles of facial expression, taste sensations from the front two-thirds of the tongue, and other functions.

Oculomotor Nerve

The third cranial nerve responsible for the control of most of the eye's movements, including the constriction of the pupil and maintaining an open eyelid.

Dorsal Spinal Cord

The portion of the spinal cord that is oriented toward the back of the body, responsible for transmitting sensory information from the body to the brain.

Ventral Spinal Cord

The front section of the spinal cord, which contains motor neurons that control muscles and movement.