n NISM Certifications
XV NISM Series XV
Medium

Which ratio indicates how efficiently a company uses its assets to generate revenue?

Practice question from NISM XV Mock Test 5 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. Return on Assets (ROA)

    Correct answer

  2. B

    Current Ratio

  3. C

    Debt-Equity Ratio

  4. D

    Earnings Per Share (EPS)

Why this is the answer

ROA = Net Income / Total Assets, indicating how effectively assets are used to generate profits. Other ratios measure liquidity, leverage, or earnings per share.

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