Design Ltd has $200 000 in current assets and $150 000 current liabilities.

Design Ltd has $200 000 in current assets and $150 000 current liabilities. What would have been the impact on current ratio if the company borrows $50 000 from the bank as a long term loan, repayable in five years?

Select one:

a. Increase

b. Decrease

c. No change

d. Increase and decrease