Negotiable Instruments

question 53

Multiple Choice

Negotiable instruments:

• A) include drafts, promissory notes, assignments, and certificates of deposit.
• B) are used primarily for smaller transactions.
• C) in the form of checks have decreased in use since 2000.
• D) have increased in usage to the point where they are now approximately equal to usage of cash for payments.

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Definitions:

Current Ratios

The liquidity ratio that provides insight into a company's capability in covering its short-term obligations with its short-term assets, essentially the same as the current ratio but rephrased.

Liquidity

The ease with which an asset can be converted into cash without affecting its market price.

Financial Problems

Issues related to managing money, including difficulties in generating income, managing expenses, or meeting financial obligations.

Benchmark Analysis

A method of comparing business processes and performance metrics to industry bests or best practices from other industries.