The Formula for the Current Ratio Is

question 16

Multiple Choice

The formula for the current ratio is:

• A) current assets - current liabilities
• B) current assets/current liabilities
• C) total debt/shareholders' equity
• D) net income/shareholders' equity

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Definitions:

Utility Maximizing Rule

A principle in economics stating that to maximize satisfaction or utility, consumers allocate their expenditures so that the last unit of currency spent on each product provides the same level of marginal utility.

Budget Constraint

The limitation on the purchasing ability of a consumer based on available income and prices.

Marginal Utilities

The extra pleasure or benefit derived from consuming one more unit of a product or service.

Hard Candies

Sweet confections made by boiling sugar syrup to a high temperature and then cooling it to form solid candies.