A Weakness of the Current Ratio Is

question 161

Multiple Choice

A weakness of the current ratio is

• A) the difficulty of the calculation.
• B) that it doesn't take into account the composition of the current assets.
• C) that it is rarely used by sophisticated analysts.
• D) that it can be expressed as a percentage as a rate or as a proportion.

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Definitions:

Schemas

Cognitive frameworks or structures that help individuals organize and interpret information based on their experiences.

Stereotype Threat

The risk of confirming negative stereotypes about an individual's racial, ethnic, gender, or cultural group.

Self-fulfilling Prophecies

Predictions that directly or indirectly cause themselves to become true, due to positive feedback between belief and behavior.

Actor-observer Bias

A cognitive bias where individuals attribute their own actions to external factors, while they attribute others' actions to internal traits or characteristics.