MUST Criteria Should Be Rank Ordered from Most Desirable to Least

question 37

True/False

MUST criteria should be rank ordered from most desirable to least desirable.

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Definitions:

Price-Earnings Ratio

A valuation ratio comparing a company’s current share price to its per-share earnings, helping investors evaluate if a stock is over or under-valued.

Net Profit Margin

A financial ratio that shows the percentage of net income generated from total revenue.

Gross Margin

The difference between sales revenue and the cost of goods sold, representing the profitability before deducting operating expenses.

Return On Total Assets

A financial ratio that measures the net income produced by total assets during a period by comparing net income to the average total assets.