Ratios used to determine whether or not a company can survive over a long period of time are ________.
A)liquidity ratios
B)solvency ratios
C)profitability ratios
D)market indicators

Question

Quizplus · Accepted Answer

Solvency ratios are used to determine whether a company can survive over a long period of time by measuring its ability to meet long-term obligations and its overall financial health. Liquidity ratios measure a company's ability to meet short-term obligations, profitability ratios measure a company's ability to generate profit, and market indicators reflect the performance of the company's stock in the market. While all of these ratios are important for evaluating a company's financial health, solvency ratios are specifically focused on its long-term survival.

Ratios Used to Determine Whether or Not a Company Can