When using ratio data for comparison to other companies,analysts should:
A)not assume that all companies in the industry are in direct competition.
B)not interpret the data as a way of determining which companies will survive and outperform others.
C)only use data from one time period.
D)use industry averages,rather than individual companies,for the comparison.

Question

Quizplus · Accepted Answer

Ratio data should be interpreted with caution and not assume that all companies in the industry are in direct competition. It is important to understand the differences in operations and strategies among the companies being compared.

When Using Ratio Data for Comparison to Other Companies,analysts Should