Which of the Following Ratios Do FIs and Regulators Often

question 97

Multiple Choice

Which of the following ratios do FIs and regulators often use as a simple measure of solvency?

• A)Current ratio.
• B)Capital to assets.
• C)Earnings before interest and taxes to total assets.
• D)Quick ratio.

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Definitions:

Personal Property

Movable assets or belongings, as contrasted with real property (land and buildings).

Seize Security

The act of taking possession of collateral or assets to satisfy a debt or enforce a legal judgment.

Personal Property Security Act

Legislation providing rules for the creation and registration of security interests in personal property as a way to secure payment or performance of an obligation.

Secured Transactions

Secured transactions are financial arrangements in which an asset is pledged as collateral for the loan, providing security to the lender that the borrower will fulfill the terms of the loan agreement.