AHIP Health Plan Finance and Risk Management AHM-520 Question # 109 Topic 5 Discussion

AHIP Health Plan Finance and Risk Management AHM-520 Question # 109 Topic 5 Discussion

AHM-520 Exam Topic 5 Question 109 Discussion:
Question #: 109
Topic #: 5

The traditional financial ratios that analysts use to study a health plan's GAAP-based financial statements include liquidity ratios, activity ratios, leverage ratios, and profitability ratios. Of these categories of ratios, analysts are most likely to use


A.

Liquidity ratios to measure a health plan's ability to meet its current liabilities


B.

Activity ratios relate the returns of a health plan to its sales, total revenues, assets, stockholders' equity, capital, surplus, or stock share price


C.

Leverage ratios to measure how quickly a health plan converts specified financial statement items into premium income or cash


D.

Profitability ratios to measure the effect that fixed costs have on magnifying a health plan's risk and return


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