Match Each of the Following Items with the Term or Phrase

question 198

Multiple Choice

Match each of the following items with the term or phrase (a-g) that best describes it. Terms or phrases may be used more than once.
-(Cash + Temporary investments + Accounts receivable) /Current liabilities

• A)Current ratio
• B)Working capital
• C)Quick assets
• D)Quick ratio
• E)Record an accrual and disclose in the notes to the financial statements
• F)Disclose only in notes to financial statements
• G)No disclosure needed in notes to financial statements

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Definitions:

Market Risk Premium

The extra return expected by investors for holding a risky market portfolio instead of risk-free securities.

Risk-free Interest Rate

The theoretical return on investment with zero risk of financial loss, typically associated with government bonds.

Total Risk

The sum of all risks affecting an investment, including both systematic (market) and unsystematic (individual) risks.

Systematic Risk

The danger associated with the overall market or a specific sector of the market that cannot be mitigated by spreading investments.