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Financial Analysis MCQs

What is the purpose of measuring profitability?

To determine the amount of cash a company brings in on an average in a month

To analyze specific expenses to look for cost cutting measures

To measure a company's ability to earn a profit and continue to grow in the short-term and long-term

To measure a company's ability to pay the highest dividend relative to its competitors

Answer

Correct Answer: To measure a company's ability to earn a profit and continue to grow in the short-term and long-term

Explanation:

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