The Current Ratio Is Irrelevant in Liquidity Analysis for Service

question 5

True/False

The current ratio is irrelevant in liquidity analysis for service companies because they do not have inventories among their current assets.

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Definitions:

Groupthink

A tendency for highly cohesive teams to lose their evaluative capabilities.

Nominal Group Technique

A structured method for group brainstorming that encourages contributions from everyone by collecting ideas independently then discussing them collectively.

Highly Structured

An organized and clearly defined system or framework with specific rules, procedures, and roles.

Inhibitions

Psychological barriers or restraints that limit or hinder an individual's actions or behaviors.