It Is Common Practice to Group Ratios into Five Basic

question 25

Multiple Choice

It is common practice to group ratios into five basic categories. Which one of the following does not belong to these four areas?

• A) liquidity ratios
• B) asset utilization ratios
• C) financial leverage ratios
• D) sources and uses of fund ratios

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Definitions:

Futures Contracts

Financial contracts obligating the buyer to purchase an asset or the seller to sell an asset, such as a physical commodity or a financial instrument, at a predetermined future date and price.

Electronic Networks

Systems or platforms that facilitate the trading of financial instruments, such as stocks and currencies, digitally and without a physical trading floor.

Trading Pits

Physical locations on the floor of some exchanges where traders use open outcry and hand signals to buy and sell commodities or financial instruments.

Futures Contracts

Standardized legal agreements to buy or sell a particular commodity or financial instrument at a predetermined price at a specified time in the future.