5. Which type of fiancial ratio indicates the efficiency of a company's resource use?

a. Liquidity ratios

b. Leverage ratios

c. Efficiency ratios

d. Profitability ratios

6. Which ratio provides an indicator of how much a firm's earnings can decline without the firm being able to meet its interest and lease obligations?

a. The acid-test ratio

b. The debt ratio

c. The total asset turnover indicator

d. The fixed charge coverage indicator

7. Return on total assets is also known as ...

a. the fixed asset turnover indicator

b. the total asset turnover indicator

c. the fixed charge coverage indicator

d. return on investment

8. In order to interpret a company's financial ratios...

a. the ratios should be compared against ratios for the industry

b. the ratios should be compared with those from earlier years

c. knowledge of the company's accounting practices is helpful

d. all of the abov