Which of the Following Is True with Respect to the Elements

question 104

Multiple Choice

Which of the following is true with respect to the elements in the external environment?

• A) The socio-cultural environment has become less important in recent years because of the increasing diversity of the population in Canada.
• B) The political-legal environment is something that cannot be influenced by Canadian business firms.
• C) The economic environment will affect the performance of almost every business.
• D) The boundary between a company and the political-legal environment is more porous than the boundary between a company and the socio-cultural environment.
• E) All of these are true.

---

Definitions:

Asset Management Ratios

Financial metrics used to assess how efficiently a company manages its assets to generate revenue, including turnover ratios for inventory, receivables, and fixed assets.

Average Collection Period

The average number of days it takes for a company to receive payments owed by its customers for credit sales.

Inventory Turnover

A financial metric indicating how many times a company has sold and replaced its inventory over a specific period.

Quick Ratio

Current assets less inventories divided by current liabilities. A financial ratio that measures a firm’s liquidity, the ability to pay its bills in the short run, without depending on converting inventory into cash. Also called the Acid Test.