Question

When you evaluate a company's financial ratios in relation to other companies in the same industry, what type of comparison is this?

A Intra firm comparison Correct Answer Incorrect Answer
B Inter firm comparison Correct Answer Incorrect Answer
C Cross-industry comparison Correct Answer Incorrect Answer
D Global comparison Correct Answer Incorrect Answer

Solution

Inter firm comparison entails evaluating a company's financial ratios and metrics in comparison to other companies in the same industry. It helps determine how a company stacks up against its competitors or peers within the industry.

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