Question $2$

Indicate the answer choice that best completes the statement or answers the question.

While ratio analysis can provide helpful information, it does have limitations$.$ What is one of the limitations of using ratio analysis?

a$.$ Ratio analysis helps to assess the performance of a company by comparing the company's key ratios to the industry average.

b$.$ Ratios like Asset management give an idea of how efficiently the firm is using its assets.

c$.$ Liquidity ratio gives an idea of the firm's ability to pay off debts that are maturing within a year.

d$.$ Companies often have some ratios that appear "good" and others that appear "bad," making it difficult to determine whether the company, on balance, is strong or weak.

e$.$ Ratio analysis helps to compare a company's own performance to its past level.