In financial analysis, what KPI is used to assess a company's profitability relative to its revenue?
- Earnings Before Interest and Taxes (EBIT)
- Gross Profit Margin
- Return on Investment (ROI)
- Working Capital Ratio
Gross Profit Margin is a key performance indicator (KPI) used in financial analysis to assess a company's profitability relative to its revenue. It represents the percentage of revenue that exceeds the cost of goods sold. ROI, EBIT, and Working Capital Ratio are important metrics but are not specifically focused on profitability relative to revenue.
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