In General, the Faster the Receivable Turnover, the Better and More

question 4

Multiple Choice

In general, the faster the receivable turnover, the better and more reliable the _______________ is.

• A) collection period
• B) current ratio
• C) inventory ratio
• D) days sales in inventory

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Definitions:

Marginal Productivity Theory

An economic theory that explains how the value of a productive input is determined by its contribution to the total output.

Income Distribution

The way in which total income is divided among the members of a society.

Marginal Contribution

The additional amount of revenue or benefit generated by utilizing one more unit of a resource or producing one additional unit of a product.

Complementary Resources

Assets or inputs that enhance the value or performance of another asset or input when used in conjunction, such as gasoline for cars or software for computers.