Financial ratios can reveal a lot about a company's liquidity, activity, and profitability.

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Financial ratios are quantitative measures derived from a company's financial statements, such as the balance sheet and income statement, used to evaluate various aspects of a company's operational efficiency, liquidity, profitability, and solvency. These ratios help investors, analysts, and management understand the company's financial health and performance.

Financial Ratios Can Reveal a Lot About a Company's Liquidity