The Quick Ratio Is the Same as Current Ratio Except

question 73

Multiple Choice

The quick ratio is the same as current ratio except it does not consider

• A)cash
• B)accounts receivable
• C)prepaid items
• D)inventories

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Definitions:

Purchasing Power

The value of a currency expressed in terms of the amount of goods or services that one unit of money can buy.

Substitution Effect

The change in consumption patterns due to a change in the relative prices of goods, leading consumers to substitute one good for another.

Diet Soda

is a low-calorie or zero-calorie carbonated beverage made with artificial sweeteners instead of sugar.

Substitution Effect

The change in consumption patterns due to a change in price, leading consumers to substitute one product for another.