Which of the Following Statements Regarding the Quick Ratio Is

question 98

Multiple Choice

Which of the following statements regarding the quick ratio is incorrect?

• A) The quick ratio is also known as the acid-test ratio.
• B) The quick ratio ignores some current assets that are less liquid than others.
• C) The quick ratio is a conservative variation of the current ratio.
• D) The quick ratio equals quick assets divided by total liabilities.

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Definitions:

Black Market

An illegal market where goods or services are traded without compliance with legal requirements, often including the sale of illicit goods.

Illegal Trading

Unlawful transactions of goods or services that may involve insider trading, market manipulation, or trading of illegal items.

Equilibrium Price

The price at which the quantity of a good demanded by consumers equals the quantity supplied by producers, leading to market stability.

Equilibrium Quantity

The quantity of goods or services supplied that equals the quantity demanded at the market equilibrium price.