Which One of the Following Transactions Will Increase the Liquidity

question 17

Multiple Choice

Which one of the following transactions will increase the liquidity of a firm?

• A)using cash to purchase new equipment
• B)increasing short-term debt while decreasing long-term debt by an equivalent amount
• C)issuing long-term debt to repurchase shares of outstanding stock
• D)increasing the sales on credit while reducing cash sales by the same amount
• E)selling inventory on credit

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Definitions:

Thurstone's Method

A psychometric technique for measuring attitudes that involves the use of a scaling method for ranking items along a continuum.

Semantic Differential Scale

A type of survey or questionnaire tool used for measuring the connotative meaning of objects, events, or concepts.

Expectancy-Value Technique

A method used to understand motivation, positing that individuals' behaviors are influenced by their expectations of success and the value they place on the outcome.

Likert Scale

Scale that evaluates how strongly people agree/disagree with favourable/unfavourable statements about an attitude object.