Which of the following statements about liquidity ratios is true?
A) The higher the current ratio,the more likely a firm is able to pay its short-term obligations
B) The lower the quick ratio relative to the current ratio,the safer a firm is in terms of liquidity
C) The lower the current ratio,the more likely a firm is able to pay its short-term obligations
D) Relatively high current ratios are usually a sign of efficient working capital management
Correct Answer:
Verified
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