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exercise

Computing ratios with user-defined function

In this exercise, you'll use the function from the last exercise to compute financial ratios. Recall that the function is:

def compute_ratio(df, numerator, denominator, ratio_name, 
                  addition_in_numerator = True,
                  addition_in_denominator = True):
  numerator_of_ratio = np.where(addition_in_numerator,
                             df[numerator].sum(axis=1), 
                             df[numerator[0]] - df[numerator[1:]].sum(
                               axis=1))
  denominator_of_ratio = np.where(addition_in_denominator, 
                               df[denominator].sum(axis=1), 
                               df[denominator[0]] - df[denominator[1:]].sum(axis=1))
  df[ratio_name] = numerator_of_ratio/denominator_of_ratio
  return df

The pandas DataFrame merged_dat is loaded for you, which you will use to compute financial ratios using the function compute_ratio.

Instrucțiuni 1 / 2

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  • Print the columns of merged_dat to verify if you can compute gross margin and asset turnover ratio.