Match These Terms to Their Correct Definition

question 222

Multiple Choice

Match these terms to their correct definition.
-each financial statement line item is expressed as a percentage of the largest statement amount, for example, net sales on the income statement.

• A)Common size statements
• B)Cross-sectional analysis
• C)Dupont analysis
• D)Horizontal analysis
• E)Ratio analysis
• F)Short-term liquidity ratios
• G)Time series analysis
• H)Vertical analysis

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Definitions:

Business Risk

The potential for losses or less than expected returns stemming from the operational aspects of a business.

Macroeconomy

The study of the performance, structure, and behavior of an economy as a whole, including total national income, GDP, and inflation rates.

Market System

A financial structure in which the choices about investment, production, and allocation are directed by the pricing cues generated by supply and demand dynamics.

Entrepreneurs

Individuals who innovate, create, and manage new businesses, taking on financial risks in the hope of profit.