Firm a Enjoys a Better Activity Ratio Than Firm B

question 51

Multiple Choice

Firm A enjoys a better activity ratio than Firm B.What might this mean?

• A) Firm A likely generates greater profits or sales than Firm B.
• B) Firm A uses its resources less efficiently than Firm B.
• C) Firm A has more customers than Firm B.
• D) Firm A generates greater profits on sales and uses its resources more efficiently than B.
• E) It might not mean anything.

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Definitions:

Shares

Units of ownership interest in a corporation or financial asset, representing an equal proportion of the company's capital.

Book Value

The net value of a company's assets as recorded on its balance sheet, calculated as total assets minus intangible assets and liabilities.

Stock Traded

Refers to shares of a company that are bought and sold in financial markets or exchanges.

Stockholders' Equity

Represents the residual interest in the assets of a corporation after deducting liabilities, essentially the net assets that belong to shareholders.