Which of the Following Statements Is Generally Incorrect from an Investor's

question 43

Multiple Choice

Which of the following statements is generally incorrect from an investor's perspective?

• A) A 1:1 current ratio is generally preferred over a 2:1 current ratio.
• B) A 20-day average collection period for accounts receivable is generally preferred over a 30-day average collection period.
• C) A 5% dividend yield is generally preferred over a 3% dividend yield.
• D) A 10% net margin is generally preferred over an 8% net margin.

---

Definitions:

Strategy

Positions the organization in the competitive environment and implements actions to compete successfully.

Kills An Idea

The act of dismissing or negating a concept or suggestion, preventing its development or implementation.

Credentials

Formal qualifications or certifications that signify a person's expertise or competence in a specific field.

Wisdom

The quality of having experience, knowledge, and good judgment; the ability to apply these attributes to make sound decisions.