-Using Figure 1

question 13

Multiple Choice

-Using Figure 1.7 we know the production of 5 units of soda and 2 units of pizza is

• A)possible, but there would be unemployed resources.
• B)possible, but only if all resources were fully employed.
• C)impossible because we have the resources but do not have the technology.
• D)impossible because we have the technology but do not have the resources.

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Definitions:

Times Interest Earned Ratio

A financial metric assessing a company's ability to meet its interest obligations from operating earnings.

Inventory Turnover

A measure of how quickly a company sells its stock of goods in a period, calculated by dividing the cost of goods sold by the average inventory level.

Equity Multiplier

A financial leverage ratio that measures the portion of a company's assets that are financed by shareholders' equity.

Debt-to-equity Ratio

The ratio that demonstrates the comparative financing from shareholders' equity and debt for a company's assets.