Unlike solvency rates,liquidity ratios relate to the company's long-run survival.
BT: Knowledge

Name: Unlike solvency rates,liquidity ratios relate to the company's long-run survival. BT: Knowledge
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Question

Quizplus · Accepted Answer

This statement is incorrect. Liquidity ratios actually relate to the company's short-term ability to meet its financial obligations. Solvency ratios, on the other hand, assess the company's long-term ability to pay its debts and survive in the long-run.

Unlike Solvency Rates,liquidity Ratios Relate to the Company's Long-Run Survival