Which of the Following Statements About Liquidity Ratios Is True

question 103

Multiple Choice

Which of the following statements about liquidity ratios is true?

• A)the lower the quick ratio relative to the current ratio, the safer a firm is in terms of liquidity.
• B)the higher the current ratio, the more likely a firm is able to pay its short-term obligations.
• C)the quick ratio is always between 0 and 1.
• D)all the above statements are true.

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