A More Stringent Measure of Liquidity Than the Current Ratio

question 96

Multiple Choice

A more stringent measure of liquidity than the current ratio is referred to as

• A)Current asset turnover.
• B)Acid-test.
• C)Collectability test.
• D)None of these ans choices are correct.

---

Definitions:

Market Rates

The prevailing interest or exchange rates in the financial markets at any given time.

Premium

The amount paid for an insurance policy or an addition to the standard cost or value of something.

Discount

A deduction from the usual cost of something, or the process of determining the present value of future cash flows by adjusting for the time value of money.

Semiannual Coupon

Interest payments made twice a year by a bond issuer to the bondholders.