A Strong Liquidity Position Means That

question 127

Multiple Choice

A strong liquidity position means that

• A) the firm is able to meet its short-term obligations.
• B) the firm uses little debt in its capital structure.
• C) the firm pays out a large portion of its net income in the form of dividends.
• D) the firm pays its creditors on time.

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Definitions:

Annual Fixed Cost

Fixed costs that a business incurs over a year regardless of its activity level, such as rent, salaries, or insurance.

Technology Use

The application of scientific knowledge for practical purposes, especially in industry and daily life.

Time Efficiency

Refers to the effective use of time to maximize productivity or achieve a task within the shortest possible duration.

Account Analysis

The process of evaluating the sales potential and profitability of individual customer accounts.