A Quick Ratio That Is Much Smaller Than the Current

question 125

Multiple Choice

A quick ratio that is much smaller than the current ratio reflects

• A) a small portion of current assets is in inventory.
• B) a large portion of current assets is in inventory.
• C) that the firm will have a high inventory turnover.
• D) that the firm will have a high return on assets.

---

Definitions:

Relative Deprivation

A sense of dissatisfaction or resentment that arises from the belief that one is worse off compared to others in a similar situation or compared to societal norms.

Happiness Set Point

The theory suggesting individuals have a baseline level of happiness which, despite changes or life events, tends to return to its original level.

Adaptation-Level

A theory suggesting that people adapt to new stimuli and events, eventually perceiving them as normal and using this new norm as a baseline for future judgments.

Emotional Satisfaction

A state of contentment and fulfillment derived from emotional experiences.