Which of the following statements is correct? a. even though firm a's current ratio exceeds that of firm b, firm b's quick ratio might exceed that of a. however, if a's quick ratio exceeds b's, then we can be certain that a's current ratio is also larger than b's. b. suppose a firm wants to maintain a specific tie ratio. it knows the amount of its debt, the interest rate on that debt, the applicable tax rate, and its operating costs. with this information, the firm can calculate the amount of sales required to achieve its target tie ratio. c. since the roa measures the firm's effective utilization of assets without considering how these assets are financed, two firms with the same ebit must have the same roa. d. suppose all firms follow similar financing policies, face similar risks, have equal access to capital, and operate in competitive product and capital markets. however, firms face different operating conditions because, for example, the grocery store industry is different from the airline industry. under these conditions, firms with high profit margins will tend to have high asset turnover ratios, and firms with low profit margins will tend to have low turnover ratios. e. klein cosmetics has a profit margin of 5.0%, a total assets turnover ratio of 1.5 times, a zero debt ratio and therefore an equity multiplier of 1.0, and an roe of 7.5%. the cfo recommends that the firm borrow money, use it to buy back stock, and raise the debt ratio to 50% and the equity multiplier to 2.0. she thinks that operations would not be affected, but interest on the new debt would lower the profit margin to 4.5%. this would probably not be a good move, as it would decrease the roe from 7.5% to 6.5%.

2. the external environment (connect)choose whether each example belongs in the general, task, or internal environment. exampleenvironmenta worldwide recession task environment / general environment / internal environmentlocal mothers asking their community grocery store to carry no-salt cheerios-type cereal for their babies task environment / general environment / internal environmentchoose the phrase that best completes the following sentence. the relationship between the task environment and the general environment is best described as: a one-way system: changes in the task environment affect the general environment, but changes in the general environment do not affect the task environment. an open system: changes in the task environment affect the general environment, and changes in the general environment affect the task environment. a one-way system: changes in the general environment affect the task environment, but changes in the task environment do not affect the general environment. a closed system: changes in the general environment do not affect the task environment, and changes in the task environment do not affect the general environment.©bloomberg via getty imagesmanagement in the newsin april 2010, the explosion of british petroleum’s (bp) deepwater horizon oil drilling rig and the accompanying oil spill dramatically changed the external environment in which all oil companies operate. the explosion released more oil than any other accidental spill in history and had a huge impact on the waters and surrounding communities of the gulf coast. the conditions that led to the spill, the attempts to stop the spill, and the clean-up and aftermath of the spill prompted debates in the u. s. senate, concern on wall street, and attention from companies all over the world. match each oil spill event with a specific dimension of the general environment. eventgeneral environment dimensionbp stock prices falling 25% during the first month after the oil spill oil seeping into pelican nesting grounds, which will place the brown pelican back on the endangered species list people moving from louisiana to oklahoma to avoid the effects of the spill