Benefits of Using Ratio Analysis Include All of the Following

question 50

Multiple Choice

Benefits of using ratio analysis include all of the following except:

• A) Ratios are usually easy to compute.
• B) It is always clear what the optimal ratio is for a company.
• C) Ratios allow analysts to look at one figure in the financial statements in relation to a second one.
• D) Ratios can be used to compare companies that report results in different currencies.

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Definitions:

Workbook Problems

Exercises or problems contained in a workbook aimed at practicing or testing knowledge in a particular subject.

Term Papers

Research papers usually required at the end of a semester or term in schools and colleges, as part of the assessment.

Utility Function

A formula that represents a consumer’s preference ranking for different combinations of goods or services, indicating the total satisfaction achieved from consumption.

Competitive Market

A market structure characterized by a large number of buyers and sellers, with no single participant able to significantly influence the market price.