Market value ratios indicate:
A)the effect of liquidity, asset management, and debt management on operating results.
B)how much debt the firm has and whether it can take on more debt.
C)the firm's ability to meet its current obligations.
D)how effectively a firm is managing its assets.
E)what investors think of the company's future prospects based on its past performance.

Question

Quizplus · Accepted Answer

Market value ratios are used to evaluate the share price of a company's stock and what investors think of the company's future prospects based on its past performance. These ratios include price-earnings ratio, market/book ratio, and others that reflect the market's opinion of a company's future growth and earnings potential.

Market Value Ratios Indicate