A(n)________ is a reserve or rainy-day fund with money set aside to be used for unexpected expenses or when normal income has been disrupted.
A) emergency fund
B) umbrella fund
C) resources fund
D) risk fund
The purpose of using financial ratios is to
A) save space on your financial statements.
B) share your financial figures with your advisors.
C) help analyze your raw data to compare how well you are doing.
D) better understand how you are managing your financial resources.
E) both C and D.
Which questions do financial ratios help you answer?
A) Do I have adequate liquidity to meet emergencies?
B) Do I have the ability to meet my debt obligations?
C) Am I saving as much as I think I am?
D) All of the above
E) A and B
Your ________ is found by dividing monetary assets by current liabilities and is a good measure of liquidity.
A) debt ratio
B) current ratio
C) net worth
D) net cash flows