When are ratios most useful for analysis?
A) When compared with both historical ratios of the same company and ratios for other companies in the industry.
B) When compared with historical ratios of the same company.
C) When used alone.
D) When compared with ratios for other companies in the industry.

Question

Quizplus · Accepted Answer

Ratios are most useful when compared with both historical ratios of the same company and ratios for other companies in the industry, as this provides context and benchmarks for evaluating performance and financial health.

When Are Ratios Most Useful for Analysis