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Which of the following ratios indicates that liquid assets are available to pay liabilities for a household?

a. Debt ratio
b. Current ratio
c. Household ratio
d. Debt payments ratio
e. Savings ratio

1 Answer

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Final answer:

The current ratio is the financial metric that indicates the availability of liquid assets to pay for a household's liabilities, measuring the household's short-term financial health.

Step-by-step explanation:

The ratio that indicates that liquid assets are available to pay liabilities for a household is the current ratio. This financial metric compares a household's current assets, like cash and other assets that can be quickly converted to cash, to its current liabilities, or debts that need to be paid within a year.

It is a measure of liquidity and an indication of a household's ability to meet short-term obligations.

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