Which term best describes the ratio that compares net income to total revenue?

The term that best describes the ratio comparing net income to total revenue is the net profit margin. This ratio is calculated by dividing net income by total revenue, which provides insights into how much profit a company makes for every dollar of revenue generated. It reflects the efficiency of a company in managing its expenses relative to its sales, making it a crucial indicator of overall profitability.

Net profit margin is expressed as a percentage, giving stakeholders a clear view of profitability after all expenses, taxes, and costs have been considered. A higher net profit margin indicates a more profitable company, while a lower margin may suggest inefficiencies or higher relative costs.

Understanding net profit margin is essential for assessing a company's financial health, making it a key performance metric for investors and analysts alike. The other terms mentioned, such as operating income and return on assets, relate to different aspects of financial performance and are not directly equivalent to the net income to total revenue ratio.