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Week 4 Concept Quiz

Week 4 Concept Quiz

Q Question 1 5 / 5 pts Describe liquidity ratios. Explain the value of the information that liquidity ratios provide. Question 2 5 / 5 pts Describe asset management ratios. Discuss any two examples. Your Answer: Question 3 4 / 5 pts Discuss the role of capital structure in the firm's management process.

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Your Answer: The liquidity ratios play an important role in measuring the liquidity of the company. It shows the ability of the company to repay its liabilities out of its available liquid assets. The liquidity of the company means how quickly the assets of the company can be converted into cash. The liquidity ratios determine the ability of the company to repay its short term debt obligations.