The McCumber Corporation Data for the Current Year: with Respect

question 15

Multiple Choice

The McCumber Corporation data for the current year: With respect to current liabilities, what would a horizontal analysis report?

• A)The current ratio is 0.92.
• B)Current liabilities are 13.35% of total capital.
• C)Current liabilities saw a 50% increase from the prior year to the current year.
• D)Current liabilities saw a 66.67% increase from the prior year to the current year.

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Definitions:

Inferior Good

A type of good for which demand decreases as the income of consumers increases, in contrast to normal goods, where demand increases with rising income.

Macaroni and Cheese

Macaroni and cheese is a popular dish made primarily of cooked macaroni pasta and a cheese sauce, often served as a comfort food.

Price Elasticity

A measure of how sensitive the quantity demanded of a good is to a change in its price, indicating how changes in price affect sales volume.

Demand Curve

A graph showing the relationship between the price of a good and the quantity demanded.