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:

Maximize Utility

The process or goal of obtaining the highest level of satisfaction or benefit from consuming goods and services, given a consumer's limitations, such as income or resources.

Income

The financial gain received by an individual or entity, typically measured over a period of time, deriving from labor, investment, or business ventures.

Marginal Utility

The additional satisfaction or benefit received by consuming one more unit of a good or service.

Money Income

The total amount of monetary earnings received by an individual or household before any deductions like taxes or social security contributions.