Final answer:
The correct option for a manager to know how easily the store's assets can be converted into cash is C) Liquidity ratio. It includes financial metrics such as the Current Ratio and Quick Ratio to assess short-term financial health and asset convertibility.
The correct option is C) Liquidity ratio.
Step-by-step explanation:
The manager of a supermarket who needs to know how easily the store's assets can be converted into cash should use the Liquidity ratio. This financial metric is crucial for assessing a company's ability to meet its short-term obligations without raising additional capital. The Liquidity ratio measures how quickly assets can be turned into cash, which is essential for a business to operate smoothly and handle unexpected expenses.
There are several types of Liquidity ratios, such as the Current Ratio and the Quick Ratio, which provide insights into the short-term financial health of a business. The Current Ratio compares current assets to current liabilities, indicating if the company has enough assets to cover its short-term debts, while the Quick Ratio (also known as the Acid-test ratio) further refines this by excluding inventory, offering a more stringent test of liquidity.
To answer the question directly, the correct option to choose is C) Liquidity ratio. This option is the one that specifically pertains to the convertibility of a company's assets into cash.