Financial ratios: the merits and why ratios are important to banks and investors

What are the merits of the following financial ratios:

Profitability Ratio
Liquidity Ratio
Debt Ratio
Asset Activity Ratio
Market Values Ratio

What do these financial ratios tell us about a firm?

Why is it important to understand what these ratios mean to both a bank and an investor?

Solution Summary

The 953 word solution presents good explanations for the various categories of ratios including their uses and benefits to organizations.