The Current Ratio Measures ________

question 66

Multiple Choice

The current ratio measures ________.

• A)a company's ability to sell its long-term assets
• B)a company's ability to pay current liabilities with its total assets
• C)a company's ability to pay current liabilities with current assets
• D)a company's profitability during a particular period

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Definitions:

Discount

A reduction in the price of goods or services, typically offered to prompt sales or recognized in the context of financial instruments.

Credit Analysis

The process by which a lender evaluates the creditworthiness of a potential borrower, assessing the ability to repay a loan.

Likelihood

The probability or chance of an event occurring or a hypothesis being correct.