Multiple choice general knowledge

The Ratio Analysis can be used as an External Financial Control Tool

  1. True

  2. False
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A Correct answer
Explanation

Ratio analysis is indeed used as an external financial control tool by investors, creditors, and analysts outside the organization to evaluate financial health and performance. External stakeholders rely on these ratios to make investment decisions, assess creditworthiness, and compare companies across industries. This external perspective complements internal management's use of ratios for operational control.

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