How Compare the actual return and financial ratio analysis
For example...
Return of stock is 0.088
Current Ratio is 1.0801
Compare the actual return and the financial ratio analysis to see if your analysis is consistent with the actual return.
How would it be consistent and how would it not be consistent. Thank you!
May 6, 2015
6 Comments • Newest first
The answer is C
[quote=SaneleeBoring]Do your own homework.[/quote]
you're the man lmao
You defintily arnt asking the question correctly. Rephrase.
Your two ratios actually have no relationship at all.
ROE shows profit whereas current ratio just measures liquidity
You're better off using an efficiency ratio and ROE or another profitability ratio. After that you could then compare it through the percentages/proportion of revenue spent on income and earnt.
The only way to see if anything is consistent in finance is to compare it with previous years or quarters (vertical or horizontal analysis or something) or to compare it with benchmarks or other businesses
Tbh im not too sure what the question is asking bc it feels like a part of it is missing too. Hope it helped
@SaneleeBoring please don't be ignorant but there are methods to help someone without spoonfeeding aka doing their homework. OP is asking for help not attitude
I just learned how to do this in first term of second year finance, but I forgot how to do it already o.o
Do your own homework.