If you wish to evaluate the liquidity of a firm, you could look at the

Question

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Current ratio helps to assess the liquidity of a firm by comparing its current assets to current liabilities. This ratio indicates whether a firm can pay its short-term debts using its current assets. A high current ratio (usually above 2:1) indicates that a firm has enough current assets to fulfill its current obligations, while a low current ratio suggests that a firm may face difficulties in meeting its short-term obligations. Thus, current ratio is a reliable measure of liquidity evaluation.

If You Wish to Evaluate the Liquidity of a Firm