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Divided We Stand

How important are financial ratios in a financial proposal?

This story appears in the May 2000 issue of Business Start-Ups magazine.

Q: Does our print and copy shop need financial ratios in our financing proposal?

A: Absolutely! However, ratios are even more important for everyday managing than for occasional financing. Our lives are full of ratios, such as miles per hour, batting averages and horsepower. Ratios are simple arithmetic--one number divided into another. In business, there are two large "families" of relationship ratios--financial and operating.

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