Which of the following categories of ratios is only relevant to a listed company? Profitability ratios Efficiency ratios Correct Answer Market performance ratios You Answered Liquidity ratios
Question
Which of the following categories of ratios is only relevant to a listed company? Profitability ratios Efficiency ratios Correct Answer Market performance ratios You Answered Liquidity ratios
Solution
The category of ratios that is only relevant to a listed company is Market Performance Ratios. This is because these ratios, which include measures such as Earnings Per Share (EPS), Price/Earnings (P/E) ratio, and Dividend Yield, are specifically designed to help investors and market analysts evaluate the financial performance and value of publicly traded companies.
Profitability ratios, efficiency ratios, and liquidity ratios, on the other hand, are relevant to all companies, whether they are publicly traded or not. These ratios provide insights into a company's ability to generate profits, use resources efficiently, and meet short-term obligations, respectively.
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