Jill's Business Has Current Assets of $50,000 and Current Liabilities

question 23

Multiple Choice

Jill's business has current assets of $50,000 and current liabilities of $25,000.Which statement is true about the company's current ratio?

• A)The ratio is 50% and is acceptable for most industries.
• B)The ratio is 2 and is acceptable for most industries.
• C)The ratio is $25,000 and is not acceptable for most industries.
• D)Current ratio can not be determined from the information given.

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Definitions:

Economic Profits

Profits in excess of what is considered normal or expected, considering both explicit and implicit costs.

Five Fundamental Questions

Key questions in economics that address what to produce, how to produce, for whom to produce, when to produce, and where to produce goods and services.

Central Bank

The national financial institution that oversees the monetary system of a country, controlling interest rates and currency supply.

Scarce Supply

Refers to the condition where the availability of a particular good or resource is insufficient to meet the demands.