When the Interest Rate in the U

question 51

Multiple Choice

When the interest rate in the U.S.falls, U.S.financial assets:

• A)become more attractive to foreign buyers.
• B)become less attractive to both foreign and domestic buyers.
• C)become more attractive to both foreign and domestic buyers.
• D)become less attractive to domestic buyers and more attractive to foreign buyers.

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Definitions:

Effective Utilization

Effective utilization refers to how efficiently resources, such as labor and equipment, are used to produce goods or services.

EBIT

Earnings before interest and taxes; a measure of a company's profitability that excludes interest and income tax expenses.

Quick Ratios

The quick ratio, also known as the acid-test ratio, measures a company's ability to meet its short-term obligations with its most liquid assets.

Liquidity Position

A measure of the ability of an entity to meet its short-term financial obligations using assets that can be quickly converted to cash.