The King Carpet Company has

$2,920,000

in cash and a total of

$11,950,000

in current assets. The firm's current liabilities equal

$5,230,000

such that the firm's current ratio equals

2.3.

The company's managers want to reduce the firm's cash holdings down to

$1,080,000

by paying

$504,000

in cash to expand the firm's truck fleet and using

$1,336,000

in cash to retire a short-term note. If they carry this plan through, what will happen to the firm's current ratio?

The new current ratio is