A low current ratio (low relative to, say, industry norms) may indicate a company may face low difficulty in paying its bills.

Name: A low current ratio (low relative to, say, industry norms) may indicate a company may face low difficulty in paying its bills.
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Question

Quizplus · Accepted Answer

A low current ratio indicates that a company may not have enough current assets to cover its current liabilities, which may lead to difficulties in paying bills. A high current ratio indicates the opposite.

A Low Current Ratio (Low Relative To, Say, Industry Norms)