Operating Efficiency Ratios | CFA Level 1 Exam Preparation

Not an Operating Efficiency Ratio

Prev Question Next Question

Question

Which of the following is NOT an operating efficiency ratio?

Answers

Explanations

Click on the arrows to vote for the correct answer

A. B. C. D.

D

Operating efficiency ratios are a measure of how well the firm is utilizing its assets and capital. This utilization has a direct yardstick in terms of total sales generated. Hence, operating efficiency ratios express total sales as a fraction of assets or equity. On the other hand, Operating profit margin belongs to the group of operating profitability ratios.