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    Two primary perspectives to use in financial ratio analysis

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    1) Briefly discuss the two primary perspectives one should use in financial ratio analysis. How many years should one review the financial statements of a firm?

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    1) The two primary perspectives used in financial ratio analysis are:
    <br>a) Time-series analysis. This perspective shows the financial results of the firm over a certain time period. For example, profits (y-axis) can be plotted over the last 5 years (x-axis).
    <br>b) Cross-section analysis. Here we ...