What Category of Ratios Measures How Effectively a Firm Can

question 40

Multiple Choice

What category of ratios measures how effectively a firm can maintain its economic position in the growth of the economy and industry?

• A) Profitability
• B) Liquidity
• C) Leverage
• D) Revenue Growth
• E) Growth

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Definitions:

Holding Cash

The practice of keeping a portion of assets in liquid cash form as a safeguard against uncertainty or to meet short-term obligations.

Total Float

The total amount of time that a project task can be delayed without causing a delay to subsequent tasks or the project's final deadline.

Cheques

Written, dated, and signed instruments that direct a bank to pay a specific sum of money to the bearer from the drawer's account.