Final answer:
Ratios that measure the efficiency of a firm's operations in generating net income are called profitability ratios.
Step-by-step explanation:
Ratios that measure how efficiently a firm manages its assets and operations to generate net income are referred to as profitability ratios. These ratios provide insight into the effectiveness of the company's operations and its ability to turn revenues into profits. Examples of profitability ratios include net profit margin, return on assets (ROA), and return on equity (ROE). Efficiency ratios are also related, as they help to assess the efficiency of a business's use of its assets and liabilities, but the correct term that relates directly to the generation of net income is 'profitability'.