Which Financial Ratio Measures the Company's Ability to Pay Off

question 59

Multiple Choice

Which financial ratio measures the company's ability to pay off its short-term obligations from current assets,excluding inventories?

• A) quick ratio
• B) current ratio
• C) cash ratio
• D) strategic ratio
• E) inventory ratio

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Definitions:

Interval Estimate

An estimate of a population parameter given as a range (interval) of values, defined by upper and lower bounds.

Sample Size

The number of observations or datapoints collected in a sample, which is a subset of the population being studied.

Population Mean

The average or central value of all the numbers in a population.

Standard Deviation

A statistic that quantifies the dispersion or variability of a distribution, calculated as the square root of the variance.