Current ratio in the company


The current ratio in the company, for which you are a financial analyst, is 3 to 1. The average for other firms in the industry is 1.6 to 1. Management has asked you to evaluate the company's ratio, and explain why it is nearly twice the industry's average. What factors are responsible for the difference? Are we better off than our competitors, or worse? Explain.

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Finance Basics: Current ratio in the company
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