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.

Question

Quizplus · Accepted Answer

A faster growing company is more likely to need external financing to fuel their growth, which could come in the form of debt or equity. Companies that are growing at a slower rate may not require as much external financing.

Which of the Following Statements Is Most Correct