Your Current Liquidity Ratio Is 2

question 64

Multiple Choice

Your current liquidity ratio is 2.0. If you take money out of your savings account to pay off a credit card your liquidity ratio will

• A) increase.
• B) decrease.
• C) stay the same.
• D) More information is needed to determine what effect this action will have.

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Definitions:

Shift in Demand

A change in the demand curve caused by factors other than the price of the good or service, leading to an increase or decrease in demand at every price.

Mass Transit

Public shared transportation systems, such as buses and trains, designed to move large numbers of people efficiently across urban and suburban areas.

Drilled Oil

Petroleum that has been extracted from the earth via drilling operations, a common method for obtaining crude oil.

Inferior Goods

Goods whose demand decreases when consumer income rises, opposite to normal goods, due to their lower quality.