Which of the following is true of current ratio? A) The more predicta

Which of the following is true of current ratio?

A) The more predictable a firm’s cash flows, the higher the acceptable current ratio.
B) A higher current ratio indicates a higher return on equity.
C) The more predictable a firm’s current ratio, the higher the current liabilities.
D) A higher current ratio indicates a greater degree of liquidity.

ANSWER

D