chapter  2
9 Pages

Using ratio analysis

A ratio is a relationship between one number and another. If one workteam has twelve people and another has eight people, the ratio of their numbers could be expressed in any of the following ways:

as 12:8 or as 12

8 or as 3:2 or as

2 or as 1.5:1 or as 1.5 to 1

Financial indicators are usually presented in one of the last two forms in the list above.