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      Question

      The ratio that measures the efficiency with which a firm

      utilizes its assets to generate sales is:
      A Liquidity Ratio Correct Answer Incorrect Answer
      B Leverage Ratio Correct Answer Incorrect Answer
      C Activity/Turnover Ratio Correct Answer Incorrect Answer
      D Profitability Ratio Correct Answer Incorrect Answer
      E Valuation Ratio Correct Answer Incorrect Answer

      Solution

      Activity or Turnover Ratios (like Inventory Turnover, Asset Turnover) specifically measure how efficiently a company uses its assets to generate sales revenue.

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