The Ability to Meet Short-Term Obligations and to Generate Revenues

question 111

Multiple Choice

The ability to meet short-term obligations and to generate revenues using the least amount of resources is called:

• A)Liquidity and efficiency.
• B)Solvency.
• C)Profitability.
• D)Market prospects.
• E)Creditworthiness.

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Definitions:

Absolute Advantage

A situation where an individual or entity can produce more of a good or service with the same amount of resources compared to others.

Input Requirements

The set of resources, materials, and labor needed for the production of goods or services.

Absolute Advantage

A condition where a country, individual, or company can produce a good or service more efficiently than competitors using the same amount of resources.

Opportunity Cost

The opportunity cost incurred by choosing a specific alternative over others.