A Bank Wants to Examine How Well a Customer Controls

question 25

Multiple Choice

A bank wants to examine how well a customer controls their expenses.They are most likely to look at which of the following ratios?

• A)Wages and salaries/Net sales
• B)Accounts receivables/(Annual credit sales/360)
• C)Net income after taxes/Net sales
• D)Income before interest and taxes/Interest payments
• E)(Current assets - Inventory)/Current liabilities

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Definitions:

Income Triples

A scenario in which an individual's or household's income increases to three times its original amount.

Slope Of Budget Line

The rate at which a consumer can trade one good for another while maintaining the same level of utility.

Price Of Good 1

The amount of money required to purchase a specific good or service, referred to as "Good 1."

Price Of Good 2

The amount of money required to purchase one unit of a second specified good or service in a market.