Which of the Following Ratios Measures the Number of Times

question 73

Multiple Choice

Which of the following ratios measures the number of times the firm can cover its current liabilities with its current assets?

• A) Current ratio
• B) Quick ratio
• C) Debt ratio
• D) Return on assets

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Definitions:

High Utilization

Refers to the extent to which a company's resources, such as workers or equipment, are being used at or near their maximum capacity.

Demand Fluctuations

Variations in the quantity of a product or service desired by consumers, often influenced by seasonality, trends, or economic factors.

Seasonal Inventory

Stock that is kept to meet the seasonal demand of products, which can vary throughout the year based on changes in customer behavior or events.

Demand Variability

Fluctuations in customer demand over a period, affecting inventory levels, supply chain strategies, and production schedules.