Which of These Ratios Is Not Directly Relevant to the Evaluation

question 48

Multiple Choice

Which of these ratios is not directly relevant to the evaluation of a company's short-term liquidity position?

• A)Operating profit ratio.
• B)Current ratio.
• C)Quick ratio.
• D)Acid test ratio.

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Definitions:

Alpha-Seeking

Refers to investment strategies aimed at achieving returns that exceed the benchmarks or indices against which they are compared, often through active management.

Relative Mispricing

A situation where the price of an asset does not accurately reflect its value, usually in comparison to similar assets.

Market Exposure

The degree to which an investment or portfolio is exposed to market risk.

Securities Act of 1933

A U.S. federal law aimed at ensuring transparency and fairness in the securities market by requiring companies to disclose relevant financial information.