The Rate of Return on Liquid Assets Is Relatively High

question 167

True/False

The rate of return on liquid assets is relatively high compared to other types of investments.

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Definitions:

Ending Fixed Assets

The value of a company's physical assets, such as property, buildings, and machinery, at the end of an accounting period.

Cash Flow From Assets

The total of cash flow to bondholders and cash flow to shareholders, consisting of operating cash flow, capital spending, and additions to net working capital.

EBIT

Earnings Before Interest and Taxes, a measure of a company's profitability based purely on operational and business activities without considering interest and tax expenses.

Depreciation

An accounting method used to allocate the cost of a tangible asset over its useful life.