The ability to meet short-term obligations and to generate revenues using the least amount of resources is called:
A)Liquidity and efficiency.
B)Solvency.
C)Profitability.
D)Market prospects.
E)Creditworthiness.

Question

Quizplus · Accepted Answer

Liquidity refers to a company's ability to meet short-term obligations, while efficiency refers to its ability to generate revenues using the least amount of resources. Together, liquidity and efficiency reflect a company's ability to effectively manage its operations and financial resources. Solvency refers to a company's ability to meet long-term obligations and is a separate concept from liquidity and efficiency. Profitability and market prospects are related to a company's ability to generate profits and grow its business, respectively, but are not directly related to liquidity and efficiency. Creditworthiness is a measure of a company's ability to repay its debts and is also not directly related to liquidity and efficiency.

The Ability to Meet Short-Term Obligations and to Generate Revenues