Which of the Following Statements Is Most Correct

question 43

Multiple Choice

Which of the following statements is most correct?

• A) The cheapest form of capital is equity
• B) Companies with the highest current ratios have the most liquidity
• C) The best indicator of short term financing needs is the cash flow adequacy ratio
• D) A faster growing company is more likely to need external financing than a slower growing company

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Definitions:

Anchoring And Adjustment

A cognitive bias where an individual relies too heavily on an initial piece of information (the "anchor") when making decisions, with subsequent adjustments made around this anchor.

Availability

The degree to which a system, subsystem, or equipment is operable and in a committable state at the start of a mission when the mission is called for at an unknown point in time.

Heuristics

Mental shortcuts or rules of thumb that simplify decision making, not always perfect but useful for practical problem-solving.

Persuasive

The ability to convince others to agree with a viewpoint, idea, or course of action through reasoning and argumentation.