Which of the Following Statements Regarding Liquidity Ratios Is True

question 3

Multiple Choice

Which of the following statements regarding liquidity ratios is true?

• A)A low current ratio generally indicates the ability to pay current liabilities on a timely basis.
• B)A low acid-test ratio generally indicates the ability to pay current liabilities on a timely basis.
• C)All current assets are due within one year and therefore have essentially equal liquidity.
• D)A high working capital generally indicates the ability to pay current liabilities on a timely basis.

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Definitions:

Radical Behaviorists

Emphasize the study of observable behavior and the environment's role in shaping behavior, often excluding internal processes like thoughts and emotions.

Observable Behaviors

Actions or reactions of individuals, directly visible and measurable, used in the study of psychology and sociology.

Covert Behavior

Behavior that is not openly acknowledged or displayed, often hidden or secretive, contrasting with overt behavior that is readily observable.

Overt Behavior

Any observable action or response made by an individual that can be seen and measured by others.