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ESTION 11 Current Ratio: Decrease; Asset Turnover Ratio: Decrease Current Ratio:

ID: 2805879 • Letter: E

Question

ESTION 11 Current Ratio: Decrease; Asset Turnover Ratio: Decrease Current Ratio: No Effect Asset Turnover Ratio: Increase oCurrent Ratio: No Effect; Asset Turnover Ratio: No Effect Current Ratio: Increase; Asset Turnover Ratio: Increase UESTION 12 he weak form EMH states that O all market trading data allpublicly av must ESTION 13 and tocks L, M, and N each have the same expected returns and standard deviation. The correlation coeflicients between the each pair of these stocks ane as falowes: L and M comation - 0.s hich pairs of stocks will have the lowest standard deviation? L and M O L and N O Mand N.

Explanation / Answer

Answer: (11)

Current ratio: Increase; Asst turnover ratio: Increase

Current ratio is equal to Current asset/Current liabilities, when current asset and current liabilities decrease by same amount, Current ratio will increase

Asset turnover ratio is equal to Sales/Average total assets, when asset decrease, ratio will increase automatically.