Which of the Following Actions Would Decrease a Firm's Liquidity

question 77

Multiple Choice

Which of the following actions would decrease a firm's liquidity?

• A) selling stock and reducing accounts payable
• B) selling machinery and using proceeds to retire bonds
• C) reducing accounts receivable and buying bonds
• D) selling bonds and holding proceeds in the cash account

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Definitions:

Current-Limiting

Describing devices or methods intended to limit the maximum current that can flow through a circuit, thus protecting the circuit from damage.

Impedance

A measurement of resistance to the flow of alternating current in a circuit, represented by the symbol Z and measured in ohms.

Power Factor

A comparison of the true power (watts) to the apparent power (volt-amperes) in an AC circuit.

Inductive Reactance

The opposition that inductors present to the flow of alternating current, due to the phase shift between voltage and current, measured in ohms.