Longer or shorter operating cycle


1. "The current ratio is preferred over the quick ratio when assessing a company's liquidity. Since these two ratios move in tandem (that is, if one goes up, the other goes up), computing the quick ratio is redundant." Do you agree or disagree? Why?

2. Overall, would a company rather have a longer or a shorter operating cycle? Why? What actions could a company take to either lengthen or shorten its operating cycle?

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Finance Basics: Longer or shorter operating cycle
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