Your Boss Decides That Your fiRm Will Switch from a Restrictive

question 243

Multiple Choice

Your boss decides that your firm will switch from a restrictive short-term financial policy to a more flexible policy. You should expect to see the firm's current ratio:

• A) Rise, due to the higher investment in current assets and the reduced use of short-term financing.
• B) Fall, due to the lower investment in current assets and the increased reliance on short- term financing.
• C) Rise, due to the lower investment in current assets and the greater use of short-term financing.
• D) Fall, due to the higher investment in current assets and the reduced use of short-term financing.
• E) To either rise or fall, but the use of short-term debt will increase.

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Definitions:

Grade-School Age

The period in a child's life when they are attending elementary or primary school, typically between the ages of 6 to 12 years.

Initiated

The process of beginning something or being introduced into a new project, status, or activity.

Nontraditional Families

Family structures that deviate from the traditional model of two biological parents raising their children, such as single-parent families, blended families, and same-sex parent families.

Traditional Families

Family structures typically consisting of a mother, father, and their biological or adopted children, emphasizing conventional roles and values.