Sean Hasn't Always Been on the Wrong Side of the Law;

question 38

Multiple Choice

Sean hasn't always been on the wrong side of the law; he grew up in a two-parent household and at a young age was involved with his church and the community garden that his dad loved. When his dad was arrested and sent to prison for growing copious amounts of marijuana, everything changed. When his father was sentenced, Sean's mom left him with his grandma and disappeared from the scene. Sean has had many chances to reform his behavior in the juvenile system, and his grandmother has tried to get him counseling and a mentor. Despite his young age of 16, Sean was sentenced as an adult in a shooting rampage that killed one and wounded four, and he was sent to prison. Sean has recently been handpicked by the warden along with several other inmates to leave the prison and work for a company that is going to replace the roofs of all of the correctional institutions in the state. The origin of this type of work or arrangement can be found in:

• A) indentured servants.
• B) the ticket of leave.
• C) the contract system.
• D) the convict lease.

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Definitions:

Financial Leverage

The use of borrowed money (debt) in an effort to increase the potential return of an investment.

Liquidity and Working Capital

The ability of a company to meet its short-term obligations using its most liquid assets, and the difference between current assets and current liabilities, respectively.

Capital Intensity Ratio

A financial metric that measures the amount of capital required to generate one dollar of revenue, indicating how capital-intensive a business is.

Total Asset Turnover Ratio

A financial metric that measures the efficiency of a company's use of its assets in generating sales revenue, calculated as net sales divided by total assets.