If a Balance Sheet Is Subjected to Vertical Analysis Which

question 120

Multiple Choice

If a balance sheet is subjected to vertical analysis which shows that current assets (using total assets as the base) have increased from 42% to 56%, this would always mean that:

• A) current assets have increased as a percentage of total assets.
• B) the dollar amount of total assets has increased.
• C) the dollar amount of total assets has decreased.
• D) the dollar amount of current assets has increased.

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Definitions:

Unadjusted Beta

Unadjusted beta is the raw beta value of a security or portfolio without any adjustments for its specific risks and characteristics, typically used as a measure of its volatility against the market.

Adjusted Betas

Betas that have been modified to account for the tendency of a stock's market risk measure to regress towards the mean over time, used in finance to predict future betas.

Market Index

A statistical aggregate that measures the performance of a basket of stocks to represent a particular market or sector.

Beta Coefficients

Statistical measures indicating the volatility of a stock or portfolio in comparison to the volatility of the overall market.