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    Question

    Which of the following is a liquidity

    ratio?
    A Equity ratio Correct Answer Incorrect Answer
    B Proprietary ratio Correct Answer Incorrect Answer
    C Net Working Capital Correct Answer Incorrect Answer
    D Capital Gearing ratio Correct Answer Incorrect Answer
    E Debt equity ratio Correct Answer Incorrect Answer

    Solution

    The liquidity ratio is a financial ratio that measures the ability of a company to meet its short-term obligations. Based on the given options, the liquidity ratio is Net Working Capital The equity ratio is a solvency ratio that measures the proportion of equity in a company's capital structure. The proprietary ratio is also a solvency ratio that indicates the proportion of total assets financed by shareholders' funds. The capital gearing ratio is a leverage ratio that measures the proportion of debt and equity in a company's capital structure.

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