Current Ratios of 1

question 92

Multiple Choice

Current ratios of 1.0 or less are considered ______.

• A) to show excessive liquidity
• B) low and indicative of potential financial problems
• C) average
• D) very positive

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Definitions:

Midpoint Method

A technique used in economics to calculate the elasticity of a variable relative to another, minimizing the variability of the measurement regardless of the direction of change.

Price Elasticity

An indicator of the extent to which the demand or supply for a product shifts following a variation in its cost.

Metric System

A decimal system of units based on the meter, kilogram, second, etc., used for scientific and most international measures.

Elastic Demand

A scenario in which the need for a product or service drastically shifts due to variations in its cost.