Which of These Categories of Financial Ratios Is Used to Measure

question 75

Multiple Choice

Which of these categories of financial ratios is used to measure a company's ability to meet its short-term financial obligations?

• A) Leverage ratios
• B) Profitability ratios
• C) Activity ratios
• D) Liquidity ratios

Calculate a country's GDP, GNP, and related economic measures using given data.

Understand and differentiate government expenditures, transfer payments, and subsidies in the context of GDP.

Recognize what comprises unemployment compensation and how it relates to GDP.

Distinguish between investment in economics versus financial investment.

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Definitions:

Limited Information

A scenario where decision-makers have only a partial view or incomplete data about a situation or problem.

Heuristics

Mental shortcuts that allow people to solve problems and make judgements quickly and efficiently.

Availability Heuristic

Availability heuristic is a mental shortcut that relies on immediate examples that come to a person’s mind when evaluating a specific topic, concept, method, or decision.

Anchoring and Adjustment

A psychological heuristic where initial information serves as a reference point for subsequent judgments and decisions.