Which of the Following Statements Is Most Correct

question 28

Multiple Choice

Which of the following statements is most correct?

• A) Many large firms operate different divisions in different industries, and this makes it hard to develop a meaningful set of industry benchmarks for these types of firms.
• B) Financial ratios should be interpreted with caution because there exist seasonal and accounting differences that can reduce their comparability.
• C) Financial ratios should be interpreted with caution because it may be difficult to say with certainty what is a "good" value. For example, in the case of the current ratio, a "good" value is neither high nor low.
• D) Ratio analysis facilitates comparisons by standardizing numbers.
• E) All of the statements above are correct.

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Definitions:

Harmful

Describes actions, substances, or situations that can cause damage or adverse effects on someone's health, well-being, or environment.

Peer Groups

Social groups consisting of members who share similar ages, interests, or social status.

Lifestyle

The way in which a person or group lives, including patterns of social relations, consumption, entertainment, and dress.

Preindustrial Societies

Societies characterized by limited technological development, with economies primarily based on agriculture and craftsmanship, and lacking in industrialized production methods.