Calculating and interpreting short-term liquidity ratios. Data taken from the financial statements of Nokia, a cellular phone manufacturer, appear as follows (amounts in millions of euros):

a. Compute the current and quick ratios on December 31 of each year.

b. Compute the cash flow from operations to current liabilities ratio and the accounts receivable, inventory, and accounts payable turnover ratios for Year 3, Year 4, and Year 5.

c. How has the short-term liquidity risk of Nokia changed during the three-year period?

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For the Year Revenues... Cost of Goods Sold Net Income Year 3 Year 4 Year 5 13,326 19,772 30,376 8,299 12,227 19,072 1,689 2,542 3,847 Cash Flow from Operations 1,694 3,009 3,560 On December 31 Year 2 Year 3 Year 4 Year 5 Cash and Marketable Securities 2,060 2,891 4,159 4,241 Accounts Receivable .... 1,640 2,806 3,827 5,594 Inventories .... 1,230 1,292 1,772 2,263 Prepayments 501 825 1,034 1,462 Total Current Assets 5,431 7,814 10,792 13,560 Accounts Payable 818 Bank Loans 554 Other Current Liabilities 1,719 1,357 760 2,336 2,202 2,814 793 1,116 3,377 4,664 Total Current Liabilities 3,091 4,453 6,372 8,594