One Weakness of the Acid-Test Ratio Is That It Puts

question 114

True/False

One weakness of the acid-test ratio is that it puts too much emphasis on the ability to convert inventory quickly into cash.

---

Definitions:

Four-drive Theory

A theory positing that human behavior is driven by four fundamental needs or drives: the drive to acquire, bond, learn, and defend.

Reactive

A response or behavior that occurs as a result of external stimuli, rather than initiating action proactively.

Proactive

An approach characterized by taking initiative and anticipatory actions to influence an outcome, rather than reacting to events after they occur.

McClelland's Learned Needs Theory

A psychological theory suggesting that individuals are motivated by three primary needs: achievement, affiliation, and power, which they learn over time.