Which Ratio Would You Use to Examine a Company's Ability

question 1

Multiple Choice

Which ratio would you use to examine a company's ability to pay its debts in the short-term?

• A)Earnings per share
• B)Acid-test ratio
• C)Debt to assets ratio
• D)Return on equity

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Definitions:

Excise Tax

A tax levied on the sale of specific goods or services, often included in the price of the item such as tobacco or alcohol.

SUVs

Short for sport utility vehicles, these are large vehicles that combine elements of passenger cars and off-road vehicles, often featuring spacious interiors and the ability to drive on rough terrains.

Government

The organized governing body of a nation, state, or community, responsible for creating and enforcing laws, policies, and regulations.

Consumers

Individuals or entities that use goods or services produced within an economy.