Which of the Following Would Indicate an Improvement in a Company's

question 3

Multiple Choice

Which of the following would indicate an improvement in a company's financial position,other things held constant?

• A)The debt ratio increases.
• B)The profit margin declines.
• C)The EBITDA coverage ratio declines.
• D)The current and quick ratios both increase.

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Definitions:

Opportunity Cost

The expense incurred by not selecting the second best choice while making a decision or opting among alternatives.

Debt Default

The failure to meet the legal obligations of a loan, such as not making scheduled payments on time.

U.S. Federal Budget

The government's estimate of revenue and spending for a fiscal year that is proposed by the President and approved by Congress.

Federal Deficits

The shortfall where the government's expenditures exceed its revenues within a specific fiscal year.