Which of the Following Statements Is CORRECT

question 12

Multiple Choice

Which of the following statements is CORRECT?

• A) A reduction in inventories will have no effect on the current ratio.
• B) An increase in inventories will have no effect on the current ratio.
• C) If a firm increases its sales while holding its inventories constant,then,other things held constant,its inventory turnover ratio will increase.
• D) A reduction in the inventory turnover ratio will generally lead to an increase in the ROE.
• E) If a firm increases its sales while holding its inventories constant,then,other things held constant,its fixed assets turnover ratio will decline.

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Definitions:

Behavioral Segmentation

The process of dividing a market into groups based on consumer behaviors such as purchasing patterns, brand interactions, and product usage.

Frequent-Flyer Programs

Loyalty programs offered by airlines to reward customers for their repeat business with benefits such as free flights.

Same Airline

Referring to flight bookings, services, or policies that apply when all legs of a journey are operated by the same airline company.

Customer Lifetime Value

The total worth to a business of a customer over the whole period of their relationship.