Why Is the Long-Term Solvency Ratio Important for Stakeholders

Multiple Choice

Why is the long-term solvency ratio important for stakeholders?

A) It may indicate excessive inventories that cannot be sold.
B) It indicates the earnings per share a stakeholder can expect to receive.
C) It indicates the efficiency with which a firm uses resources.
D) It indicates the firm's ability to generate cash.
E) It may indicate collapse or takeover opportunities.