Howdy, Stranger!

It looks like you're new here. If you want to get involved, click one of these buttons!

CFA Events Calendar

View full calendar

Recommended Discussions

See how our partners can help you ace your CFA exams.

CFA Level 1 Question of the Week - Fixed Income

The two primary categories of ratios used for credit analysis are:
AnalystPrep
CFA Question Bank, Video Lessons, and Study Notes can be found at https://analystprep.com 
Register today for 120 free practice questions and 10 hours of video

CFA Level 1 Question of the Week - Fixed Income 10 votes

A. leverage and coverage ratios.
60% 6 votes
B. operating and financial ratios.
40% 4 votes
C. profitability and liquidity ratios.
0% 0 votes

Comments

  • Matt_AnalystPrepMatt_AnalystPrep MontrealPosts: 141 Associate
    The correct answer is A.

    The two primary categories of ratios used for credit analysis are leverage and coverage ratios.

    A leverage ratio is any one of several financial measurements that look at how much capital comes in the form of debt (loans) or assesses the ability of a company to meet financial obligations.

    A coverage ratio is a measure of a company's ability to meet its financial obligations. In broad terms, the higher the coverage ratio, the better the ability of the enterprise to fulfill its obligations to its lenders.
    AnalystPrep
    CFA Question Bank, Video Lessons, and Study Notes can be found at https://analystprep.com 
    Register today for 120 free practice questions and 10 hours of video
Sign In or Register to comment.