Please answer all questions and define all terms. Thank you!

1. Why is the current ratio used to measure a firm's liquidity? 2. What is a firm's net working capital, and how is it related to the current ratio and the firm's overall liquidity? 3. What is the risk-retum tradeoff that arises when a firm manages its working capital? 4. Define the following terms: a. Permanent asset investments b. Temporary asset investments c. Permanent sources of financing d. Temporary sources of financing e. Spontaneous sources of financing