Which of the Following Would, Generally, Indicate an Improvement in a Company's

question 61

Multiple Choice

Which of the following would, generally, indicate an improvement in a company's financial position, holding other things constant?

• A) The total assets turnover decreases.
• B) The TIE declines.
• C) The DSO increases.
• D) The EBITDA coverage ratio increases.
• E) The current and quick ratios both decline.

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Definitions:

Overall Economy

The sum total of all the economic activity within a given region or country, encompassing all sectors, markets, and levels of income.

Portfolio Beta

A measure of the volatility of a portfolio relative to the overall market; the aggregate beta of all the investments in the portfolio.

Systematic Risk

The inherent risk associated with the entire market or market segment, undiversifiable through portfolio diversification.

Unsystematic Risk

The risk associated with a specific company or industry, which can be mitigated through diversification of an investment portfolio.