Which One of the Following Is Not True of the Acid

question 4

Multiple Choice

Which one of the following is not true of the acid test ratio?

• A) It is a measure of the very short-term liquidity of a business.
• B) You would expect the acid test ratio of a cash business to be lower than that for a credit business.
• C) The acid test ratio will always be greater than the current ratio.
• D) The higher the acid test ratio, the better the liquidity of the business.

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Definitions:

Metabolic Rate

The rate at which the body burns calories to produce energy.

Calories

Units of energy in food, quantifying the amount of energy provided to the body when consumed.

Set-Point Theory

A theory that suggests human body weight is regulated around a genetically predetermined 'set point.'

Hypothalamus

A region of the brain responsible for the regulation of certain metabolic processes and other activities of the autonomic nervous system, including temperature regulation, thirst, hunger, sleep, mood, and sex drive.