An Example of a Liquidity Ratio Is _______

question 2

Multiple Choice

An example of a liquidity ratio is _______.

• A)fixed asset turnover
• B)current ratio
• C)acid test or quick ratio
• D)A and C
• E)B and C

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Definitions:

Cash Flows

The total amount of money being transferred into and out of a business, affecting the organization's liquidity, financial health, and operational capabilities.

Marketable Securities

Financial assets that can be quickly converted into cash at a known price.

Capacity

The maximum amount that something can contain or produce.

Projected Cash Flows

This refers to the forecasted movement of money in and out of a business over a specific period, helping to estimate its financial health and operational viability.