If a Firm Sold Some Inventory on Credit,its Current Ratio

question 11

True/False

If a firm sold some inventory on credit,its current ratio would probably not change much,but its quick ratio would increase.

---

Definitions:

Ordinal Variables

Variables that represent categories with a natural order or ranking, but where the distances between categories are not necessarily equal.

Spearman Rank-Order

A nonparametric measure of rank correlation that assesses how well the relationship between two variables can be described using a monotonic function.

Pearson Correlation

A measure of the linear correlation between two variables X and Y, giving a value between -1 and 1 which indicates the extent of their linear relationship.

Coefficient

A numerical or constant factor in a mathematical equation that multiplies a variable.