Explain Content Validity and Construct Validity

question 32

Essay

Explain content validity and construct validity.

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Definitions:

Acid-Test Ratio

A financial metric used to evaluate a company's short-term liquidity position by dividing its most liquid assets by its current liabilities.

Current Ratio

A financial metric indicating a firm's capacity to fulfill its short-term debts, which are obligations due within the next year, by dividing its current assets by its current liabilities.

Debt Ratio

A financial ratio that measures the proportion of a company's total debt to its total assets, indicating the company's leverage level.

Inventory Turnover in Days

A metric that calculates the number of days it takes for a company to sell through its entire inventory, indicating the efficiency of inventory management.