An Increase in the Current Liabilities to Total Assets Ratio

question 7

Multiple Choice

An increase in the current liabilities to total assets ratio has the effects of __________on profits and__________on risk.

• A) a decrease; an increase
• B) a decrease; a decrease
• C) an increase; a decrease
• D) an increase; an increase

---

Definitions:

Disclosure Statement

A document that outlines important or required information that a company must provide to consumers, investors, or regulatory bodies, particularly regarding financial operations, risks, or conflicts of interest.

Exclusive Territory

A designated area or market where a specific distributor or sales agent has the exclusive rights to sell a particular product or service.

Franchise Purchase

The act of buying the rights to operate a branch of an established business, allowing the purchaser to sell the franchisor's products or services under their business model and brand.

Franchise

A business model where individuals or entities are granted the rights to operate a business under the brand and guidance of an established company.