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    Question

    Which metric is commonly used to evaluate a company’s

    operational efficiency?
    A Price/Earnings ratio Correct Answer Incorrect Answer
    B Operating ratio (Operating expenses / Net sales) or Asset turnover Correct Answer Incorrect Answer
    C Debt/equity ratio only Correct Answer Incorrect Answer
    D Cash conversion cycle only Correct Answer Incorrect Answer
    E Dividend payout ratio only Correct Answer Incorrect Answer

    Solution

    Operating ratio and asset turnover measure operational efficiency.

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