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Which of the Following Is True of Current Ratio

Question 140

Multiple Choice

Which of the following is true of current ratio?


A) The more predictable a firm's cash flows, the higher the acceptable current ratio.
B) A higher current ratio indicates a higher return on equity.
C) The more predictable a firm's current ratio, the higher the current liabilities.
D) A higher current ratio indicates a greater degree of liquidity.

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